What Actually Moves Your Credit Score (And What Doesn’t)

Published: February 9, 2026  |  11 min read

Your credit score affects more of your financial life than almost any other three-digit number you'll encounter. It determines whether you get approved for mortgages, auto loans, and credit cards. It controls the interest rates you pay (or don't pay) on those loans. It influences your apartment rental applications, insurance premiums, and occasionally even job opportunities in certain industries.

Yet despite how critical credit scores are, misinformation runs rampant. People obsess over factors that don't matter (like income or debit card use) while ignoring the behaviors that actually move the needle. Others assume their score is mysteriously out of their control, when the reality is that five specific factors drive nearly everything.

This guide cuts through the noise. Below, you'll learn exactly which factors control your credit score and how much weight each one carries, what common behaviors have zero impact despite popular belief, and what's changed in 2026 with new scoring models and reporting rules. No myths, no confusion — just the real mechanics behind how credit scoring actually works.

Whether you're building credit from scratch, recovering from past mistakes, or trying to optimize an already-solid score, understanding these fundamentals puts you in control of one of the most powerful numbers in your financial life.

The 5 Factors That Actually Control Your Credit Score

FICO scores (used by roughly 90% of lenders) and VantageScore models both rely on five core factors. While the exact algorithms remain proprietary, the credit bureaus have been transparent about what matters and how much weight each factor carries. Here's the breakdown:

1. Payment History — 35% of Your Score

Payment history is the single most important factor in your credit score, and it's exactly what it sounds like: Do you pay your bills on time? This includes credit cards, auto loans, mortgages, student loans, personal loans, and even certain utility accounts if they're reported to the bureaus.

What gets evaluated:

• Whether you've made payments by the due date (even one day late can eventually be reported, though most creditors report after 30 days past due)
• How many accounts have late payments
• How late those payments were (30 days late vs. 60 days late vs. 90+ days late — each progressively worse)
• How recently late payments occurred (recent late payments hurt more than old ones)
• Presence of collections, charge-offs, foreclosures, bankruptcies, or tax liens

The damage from late payments: A single 30-day late payment can drop your score by 60-110 points depending on your starting score and overall credit profile. Late payments remain on your credit report for seven years, though their impact diminishes over time as you build positive payment history.

The fix: Set up automatic minimum payments on every credit account. Even if you plan to pay more later in the month, autopay ensures you never accidentally miss a due date. If you do miss a payment, contact the creditor immediately — some will remove the late payment notation if you have an otherwise perfect history and can demonstrate it was a one-time error.

2. Credit Utilization (Amounts Owed) — 30% of Your Score

Credit utilization is the ratio of your current credit card balances to your total available credit limits. If you have $10,000 in total credit limits across all cards and you're carrying $3,000 in balances, your utilization is 30%.

Why it matters: High utilization signals to lenders that you might be financially overextended or overly reliant on credit to cover basic expenses. Conversely, low utilization demonstrates that you're managing credit responsibly and not living beyond your means.

The benchmarks:

• Below 30%: Generally considered acceptable and won't significantly hurt your score
• Below 10%: Optimal range where you'll see the best score benefits
• Above 30%: Starts negatively impacting your score
• Above 50%: Significant score damage
• Maxed out (90%+): Major red flag to lenders, substantial score reduction

Both overall and per-card utilization matter: Scoring models look at your total utilization across all cards and the utilization on individual cards. Having one card maxed out at 95% will hurt your score even if your overall utilization is low because you have multiple cards with zero balances.

The fastest score boost: Credit utilization is one of the quickest levers you can pull to improve your score. Pay down high balances, and you could see score improvements within 30-60 days once the lower balances are reported to the bureaus. Alternatively, requesting credit limit increases (without increasing spending) automatically lowers your utilization ratio.

3. Length of Credit History — 15% of Your Score

Credit scoring models reward longevity. A longer credit history provides more data about your borrowing patterns and demonstrates sustained responsible behavior over time.

What gets evaluated:

• The age of your oldest credit account
• The average age of all your accounts combined
• How long specific types of accounts have been open

Why this matters: Someone with 15 years of credit history and perfect payment patterns is statistically less risky than someone with only 2 years of history — even if both have paid every bill on time. More data equals more confidence for lenders.

Common mistake: Closing old credit cards, especially your oldest one, can shorten your credit history and hurt your score. Even if you're not actively using an old card, keeping it open (assuming it has no annual fee) preserves that history and helps your average account age.

For those building credit: This is the one factor you can't rush. Time is the only solution. Focus on maintaining perfect payment history and low utilization while your accounts age naturally. If you're starting from zero, consider becoming an authorized user on a family member's established account with excellent payment history — you'll inherit the age of that account on your credit report.

4. Credit Mix — 10% of Your Score

Credit mix refers to the variety of credit types in your portfolio. Lenders like to see that you can responsibly manage different kinds of credit simultaneously.

Types of credit considered:

• Revolving credit: Credit cards, retail store cards, lines of credit (these have variable balances that you can pay down and use again)
• Installment loans: Auto loans, mortgages, student loans, personal loans (these have fixed payment amounts over a set term)
• Other: BNPL accounts (as of 2026, being reported by major providers)

The reality check: While credit mix contributes to your score, it's the smallest traditional factor at only 10%. Don't take out loans you don't need just to diversify your credit types. If you only have credit cards right now and manage them well, you'll still have a strong score. When you do need an installment loan (for a car, home, or major purchase), it will naturally add to your mix over time.

Strategic note: Having both revolving and installment accounts shows lenders you can handle different payment structures and debt types, but obsessing over this factor is rarely worth the effort compared to focusing on payment history and utilization.

5. New Credit and Inquiries — 10% of Your Score

This factor tracks how often you're applying for new credit and how many new accounts you've recently opened. Opening multiple accounts in a short timeframe can signal financial distress or irresponsible credit seeking.

Hard inquiries: When you apply for credit (credit card, auto loan, mortgage, personal loan), the lender requests your credit report, creating a "hard inquiry" or "hard pull." Each hard inquiry typically reduces your score by 5-10 points and remains on your report for two years (though it only impacts your score for about 12 months).

The rate-shopping exception: Credit scoring models understand that smart consumers shop around for the best rates on major loans. If you're applying for mortgages, auto loans, or student loans, multiple inquiries within a 14-45 day window (depending on the scoring model) are typically counted as a single inquiry. This allows you to compare offers without being penalized repeatedly.

What doesn't count against you: Soft inquiries — when you check your own credit, when creditors check your credit for pre-approval offers you didn't request, or when employers check your credit (with permission) — do not affect your score at all.

Strategic guidance: Space out credit applications when possible. If you open three new credit cards in two months, even with perfect payment history, your score will take a temporary hit both from the inquiries and from the reduced average age of accounts. Plan major credit applications (like mortgages) for times when you don't need to open other accounts.

What Doesn't Affect Your Credit Score (Common Myths Debunked)

Just as important as knowing what does affect your score is understanding what doesn't. These factors have absolutely zero direct impact on your credit score:

Your Income or Net Worth

Credit scoring models do not consider how much money you make or how much wealth you have accumulated. Someone earning $40,000 per year who manages debt responsibly can have an excellent credit score, while someone earning $400,000 who mismanages credit can have a terrible score.

Why this confuses people: Lenders do consider income when making lending decisions (it affects your debt-to-income ratio and ability to repay), but income doesn't feed into the credit score calculation itself. Your credit report and score reflect your history of managing debt, not your earning capacity.

Checking or Savings Account Balances

The money in your bank accounts is invisible to credit scoring models. Having $50,000 in savings doesn't boost your score, and having $100 doesn't hurt it. Bank account activity simply isn't reported to credit bureaus (unless you overdraft and the account goes to collections, which would hurt your score).

Debit Card Usage

Using a debit card — whether you run it as "debit" or "credit" at the point of sale — has zero impact on your credit score. Debit cards pull money directly from your checking account and don't involve any form of credit, so there's nothing to report to credit bureaus. If you want to build credit, you need an actual credit card or loan.

Age, Race, Gender, Marital Status, or Employment Status

Federal law (specifically the Equal Credit Opportunity Act) explicitly prohibits credit scoring models from considering these demographic factors. Your credit report doesn't track your age, race, gender, whether you're married or single, or whether you're employed or unemployed. The only thing that matters is how you manage credit accounts.

Checking Your Own Credit Score or Report

This is perhaps the most persistent myth. Checking your own credit score or pulling your own credit report is a "soft inquiry" and has absolutely zero impact on your score. You can check your score daily if you want — it won't hurt anything.

The confusion: This myth likely persists because people confuse soft inquiries (checking your own credit) with hard inquiries (applying for new credit). Only hard inquiries from lenders affect your score.

Carrying a Balance on Credit Cards

You do not need to carry a balance month-to-month or pay interest to build credit. This is one of the costliest myths. Paying your credit card in full every month demonstrates excellent credit management and keeps your utilization low — both positive for your score. Carrying a balance just means you're paying unnecessary interest charges.

Getting Married (Merging Spouses' Credit)

When you get married, your credit reports remain completely separate. There's no such thing as a "joint credit report" or "household credit score." Each person maintains their individual credit history and score. If you apply for joint credit (like a mortgage together), lenders will review both credit scores separately and make decisions based on both profiles.

Closing Paid-Off Loans

Paying off an installment loan (auto loan, personal loan, mortgage) closes the account naturally, and this is positive for your credit. The paid-off loan remains on your credit report for up to 10 years, continuing to demonstrate your successful repayment history. Don't worry that completing a loan will damage your score — it won't.

What's Changed in 2026: New Credit Scoring Models and Reporting Rules

2026 has brought significant updates to how credit is scored and what information is included in credit reports. Here's what you need to know:

FICO 10T and VantageScore 4.0: Trended Data

Traditional credit scores looked at a snapshot of your credit at a single point in time. The newest models — FICO 10T and VantageScore 4.0 — now analyze your credit behavior over time, typically reviewing patterns from the past 24 months.

What this means: If you consistently pay down balances each month, the models recognize this positive trend and may reward you with a higher score. Conversely, if you're steadily increasing balances or frequently carrying high utilization, the models identify this as higher risk. Your consistent habits now matter more than they used to.

Rent and Utility Payments Now Count

VantageScore 4.0 and some newer FICO models can now incorporate rent payments, utility bills, and telecom payments into credit scores — if these are being reported to the bureaus. This is particularly beneficial for people with "thin" credit files (few or no traditional credit accounts) or those building credit from scratch.

How to enable this: Services like Experian Boost, RentTrack, and Esusu allow you to voluntarily report these payments. If you've been paying rent and utilities on time for years, adding this data to your credit file can potentially boost your score by 10-30+ points immediately.

Important caveat: Not all lenders use scoring models that incorporate alternative data yet, so the impact varies depending on which score version your lender pulls.

Medical Debt Under $500 Removed

As of 2026, all three major credit bureaus (Equifax, Experian, TransUnion) have removed paid medical collections from credit reports entirely, and medical debts under $500 no longer appear even if unpaid. This change helps millions of people whose credit scores were previously damaged by small medical bills that went to collections.

What this means for you: If you had small medical collections hurting your score, they should automatically disappear from your reports. For medical debts above $500, they'll still report if they go to collections, but only after a 12-month waiting period (giving you more time to resolve them before credit damage occurs).

Buy Now, Pay Later (BNPL) Reporting

Services like Affirm, Klarna, Afterpay, and PayPal Pay in 4 are increasingly reporting payment activity to credit bureaus. If you use BNPL services and pay on time, this can help build positive credit history. However, missed payments can now hurt your score, whereas in the past, BNPL activity was largely invisible to credit scoring.

Strategic consideration: Treat BNPL accounts with the same seriousness as credit cards. Set up automatic payments to ensure you never miss due dates, since these now have real credit consequences.

Faster Dispute Resolution

Updates to the Fair Credit Reporting Act have accelerated dispute timelines and require credit bureaus to provide better documentation when investigating errors. If you find inaccuracies on your credit report, the resolution process should be faster and more transparent than in previous years.

Practical Strategies: Controlling What Actually Matters

Now that you understand which factors drive your credit score, here's how to optimize each one:

Payment History (35%): Automate Everything

Set up automatic minimum payments on every single credit account. Use calendar reminders as backup. If you're struggling to keep track of multiple due dates, consider consolidating due dates by asking creditors to move them to the same day each month. Even if you plan to pay more than the minimum (and you should), autopay protects you from accidental late payments that could devastate your score.

Credit Utilization (30%): Multiple Strategies

Pay down balances aggressively: Focus on cards with the highest utilization first. Getting any card below 30% (ideally below 10%) should be a priority.

Request credit limit increases: If you have good payment history, call your credit card issuers and request limit increases. This instantly lowers your utilization ratio without requiring you to pay down balances. Just don't use the additional credit.

Make multiple payments per month: If you charge $2,000 per month on a card with a $5,000 limit but pay it off in full, your utilization still shows as 40% if you only pay once after the statement closes. Making payments throughout the month (or right before the statement closing date) keeps your reported balance low.

Credit History Length (15%): Preserve Old Accounts

Keep your oldest credit cards open and occasionally use them for small purchases to prevent closure due to inactivity. If an old card has an annual fee you don't want to pay, call the issuer and ask to product-change to a no-fee version of the card — this preserves your account history without the ongoing cost.

Credit Mix (10%): Let It Develop Naturally

Don't take out loans you don't need just to diversify your credit types. When you organically need an auto loan, mortgage, or other installment loan, it will naturally add to your mix. If you're considering debt consolidation or need to make a major purchase, choosing an installment loan over additional credit card debt can help your mix, but only if it makes financial sense independent of the credit score benefit.

New Credit (10%): Be Strategic About Applications

Space out credit applications by at least 3-6 months when possible. If you're shopping for mortgages or auto loans, compress all applications into a 14-day window to take advantage of the inquiry bundling. Before applying for new credit, ask yourself if you genuinely need it or if you're just chasing rewards or promotional offers.

The Bottom Line: Your Score Is Within Your Control

Credit scores can feel mysterious because the exact algorithms are proprietary and because so much misinformation circulates. But once you cut through the myths, the mechanics are straightforward: pay every bill on time, keep balances low relative to your limits, maintain accounts over time, and be thoughtful about applying for new credit.

These five factors — payment history, credit utilization, credit history length, credit mix, and new credit — drive everything. Meanwhile, income, bank account balances, debit card use, demographics, and checking your own credit have zero impact despite what your uncle or a random internet forum might have told you.

The 2026 updates (trended data, alternative credit inclusion, medical debt relief, BNPL reporting) mostly benefit consumers who manage credit responsibly, rewarding consistent positive behavior and providing more pathways for people with thin credit files to establish scores.

Your credit score isn't fixed. It's not some arbitrary number controlled by mysterious forces. It's a direct reflection of your credit management habits, and every single factor that matters is within your control. Make smart decisions today, maintain those habits consistently, and your score will reflect it.

Frequently Asked Questions

How long does it take to build good credit from scratch?

Building a solid credit score from zero typically takes 6-12 months of consistent positive activity. Most credit scoring models require at least one account that's been open for six months before they can generate a score. If you open a secured credit card or become an authorized user on someone else's account today, you can expect to have a basic FICO score within 6 months, assuming you make all payments on time and keep utilization low. Reaching a "good" score (670-739 FICO) usually takes 12-18 months of perfect behavior. To accelerate this timeline, consider becoming an authorized user on a family member's long-standing account with perfect payment history — you'll inherit the age of that account, potentially giving you a score much faster. Some people see scores in the mid-600s within just a few months using this strategy. For more tactical approaches to building credit quickly, including strategies for thin credit files, check out our comprehensive credit-building guide.

Can I have a perfect credit score if I've never had debt?

No — this is a common misconception. While avoiding debt is generally smart personal finance, you cannot build a credit score without using credit. Credit scores measure how well you manage debt and credit obligations, so having no credit history means having no score at all (or a very thin file that generates a low score). You don't need to carry debt or pay interest — you can achieve an excellent credit score by using credit cards for normal purchases and paying them off in full every month. This demonstrates responsible credit use without costing you a cent in interest. The minimum baseline for building credit is at least one credit account (credit card, loan, etc.) that you're actively managing. Some alternative scoring models like VantageScore 4.0 can incorporate rent and utility payments to help people without traditional credit, but traditional FICO scores still require at least one credit account. If you've deliberately avoided all credit products, consider opening one credit card, using it for gas or groceries, and paying it in full monthly — this builds excellent credit at zero cost.

Does closing a credit card always hurt your credit score?

Closing a credit card typically hurts your score, but the degree of damage varies significantly depending on your overall credit profile. Here's what happens when you close a card: (1) Your total available credit decreases, which increases your overall credit utilization ratio — if you're carrying balances on other cards, this can significantly hurt your score; (2) Your average account age may decrease, especially if the closed card was one of your older accounts — though the closed account continues to age on your report for up to 10 years before falling off; (3) Your credit mix might be affected if this was your only card of a certain type. The score impact is usually minimal (5-15 points) if you have multiple other cards with perfect payment history, low utilization, and you're closing a relatively new card. The impact is substantial (30-50+ points) if you're closing your oldest card, you have high utilization on remaining cards, or you don't have many other accounts. Best practice: Keep old cards open unless they have annual fees you don't want to pay or you genuinely can't trust yourself not to overspend. If you must close a card with an annual fee, call first and ask to product-change to a no-fee version to preserve the account history.

How much does one late payment actually hurt my credit score?

A single late payment can drop your credit score by 60-110 points, with the exact damage depending on your starting score and overall credit profile. Generally, the higher your score before the late payment, the bigger the drop — someone with a 780 score might fall to 670-720, while someone with a 680 score might drop to 620-650. The severity also depends on how late the payment is: payments 30 days late are bad, 60 days late is worse, and 90+ days late is devastating. Late payments remain on your credit report for seven years, though their impact diminishes over time as you build positive payment history. After 12-24 months of perfect payments following a late payment, much of the damage is recovered. Critical note: most creditors don't report late payments to the bureaus until you're 30 days past due, so if you realize you missed a payment that's only 5-10 days late, pay immediately — you may avoid credit damage entirely. If you do get reported, call the creditor and politely explain the situation; some will remove the late payment notation if you have an otherwise perfect history and can demonstrate it was a one-time mistake. This strategy works best if you've been with the creditor for several years and this is genuinely your first missed payment.

Should I pay off collections or let them age off my credit report?

This is a nuanced question with no universal answer — it depends on your specific situation and timeline. Collections accounts remain on your credit report for seven years from the original delinquency date, regardless of whether you pay them. Here's the strategic breakdown: If the collection is recent (under 2 years old): Paying it off typically helps your score, especially with newer credit scoring models like FICO 9 and VantageScore 3.0/4.0, which ignore paid collections entirely. Even older scoring models reduce the negative weight of paid collections compared to unpaid ones. If the collection is old (5-7 years): It's already having minimal impact on your score since age reduces the damage, and it will fall off your report soon anyway. Paying it could reset the "last activity date" in some states (depending on whether the collection agency reports it as a new entry), potentially restarting the clock. However, the original delinquency date should remain unchanged. Strategic approach: If you need to improve your score for a major purchase soon (mortgage, auto loan), negotiate "pay for delete" with the collection agency — they remove the entry entirely in exchange for payment. Get this in writing before paying. If you're not in a rush and the collection is old, letting it age off might be smarter. Always validate the debt first (request verification that you actually owe it) since many collection accounts contain errors. Medical collections under $500 no longer appear on credit reports as of 2026, so check if yours qualifies for automatic removal.

Do I need to use all my credit cards to maintain my credit score?

No, you don't need to use all your cards regularly, but you should use them at least occasionally to prevent closure due to inactivity. Most credit card issuers will close accounts that show no activity for 12-24 months (policies vary by issuer). When an issuer closes a card, it can hurt your score by reducing your available credit (increasing utilization) and potentially shortening your average account age if it was an older card. Best practice: Set small recurring charges on cards you don't actively use (Netflix subscription, monthly charity donation, etc.) and set up autopay to handle them. This keeps the accounts active with zero effort on your part. Alternatively, make a small purchase every 6-12 months on each card just to show activity. You don't need to carry balances month-to-month — in fact, you shouldn't. Simply using the cards for something, anything, and then paying them off in full is sufficient to maintain the accounts and your score. The only exception: if a card has a high annual fee and you're not using the benefits, it might make sense to close it or downgrade to a no-fee version, accepting the minor score impact as the cost of avoiding the fee.

Can my employer check my credit score as part of a background check?

Employers can request your credit report (with your written permission) as part of pre-employment screening, but they cannot see your actual credit score. What they receive is a modified version of your credit report that shows your payment history, outstanding debts, and any public records like bankruptcies or liens, but it doesn't include your credit score number or account numbers. This practice is most common in industries that involve financial responsibility (banking, accounting, government, defense) or positions with access to sensitive information or large sums of money. The logic is that someone with severe financial problems might be at higher risk for theft, fraud, or bribery. However, many states have passed laws limiting when and how employers can use credit reports in hiring decisions, recognizing that past financial hardships (medical debt, job loss, divorce) don't necessarily predict job performance. If you're job hunting and concerned about your credit, focus on explaining any major negative items truthfully if asked — employers are often more understanding than you'd expect, especially if you can demonstrate you're actively addressing the issues. This is another good reason to check your own credit report regularly (which doesn't affect your score) so you know what employers might see and can prepare responses for any concerning items.