February is “Get Your Credit in Check Month”, Gumbonation. That’s why this month we will focus on how a credit score comes about, credit fundamentals, and so much more. Here’s how the numbers break down when it comes to your actual credit score.

The first 35% of your score is based on your payment history. Do you have late fees? Liens? Collections? Foreclosures? All of these factors will go into determining your payment history.

The next 30% of your score is determined by the amounts owed or, your credit utilization. Essentially, how well do you manage your money? Are you maxing out those credit cards?

Those two factors combined, your payment history and your amount owed, make up for 65% of your credit score. 65%!!! So, you have to be very cautious with both of these factors.

The next 15% of your credit score is the length of your credit history. This is why you shouldn’t close out old credit cards. Even though they are not being utilized, old credit cards show that you have an established credit history.

The next 10% of your score is based on new credit.

The last percentage of your credit score is determined by the types of credit you have, such as credit cards, installment accounts, mortgages, etc. Essentially, this is your secure debt vs. unsecure debt.

And that folks is the credit score pie! Stay tuned throughout the month for more information on all things credit.

Speaking of credit, don’t forget to sign up for my webinar on Wednesday, February 12th. It’s easy, just send your name, phone number and email to info@mortgagegumbo.com, and receive a link to this free credit fundamental webinar. All things credit and the best tips around will be discussed.

If you need answers right away, we are here at Mortgage Gumbo to help. You can always contact me, Dwayne Stein at 504-207-7600 or at info@mortgagegumbo.com.