If I were to prove that:
I can get credit/use credit/pay credit.
I have a sizeable income
I have assets to match Warren Buffets
and what ever else goes into the magic credit score black box,
What would be the highest possible credit score?
The FICO scale maxes out at 850. Other scales have different ranges.
FICO does not consider your income or assets, only your history of paying on time, utilization ratio, length of your credit history, which types of credit you have used, and the number of recent credit applications.
Even Warren Buffet would have a shitty score if he wasn’t on top of his bills.
Yes, credit score is only one factor in credit decisins (although it can serve as an initial hurdle where no other factors are considered in some automated systems). Things like income and assets, as well as relevant ratios are other inputs that are taken into account along with credit score.
freido has the list of credit score factors right, except that it also includes bankruptcies, court judgments, and collections accounts.
ETA: It also seems to take into account how many installment loans you have - which is different than credit utilization, although the exact mechanic here isn’t something I’ve been able to put my finger on.
A related question if I may.
We always pay off our charge cards each month. The only debt we “owe” is on our home loan. It’s been this way for many years. In the past when applying for a new card I’ve only listed my home loan as a debt because I figured that by debts they were referring to continuing obligations. If I’d had a card that I was only paying the minimum or something other than paying the complete amount I’d have listed it.
Is that correct thinking on my part? Or would you list all your cards, three in my case, and the average amount charged each month?
Debt means mortgages, home equity loans and other installment loans( Auto, boat, etc), plus revolving debt, such as equity lines or credit cards.
Doesn’t mean cell phone bills, electric, cable, insurance, taxes, etc.