Infographic: The Five Factors That Make Up Your Credit Score

Five factors go into the scoring of your credit score. Those factors are the type of credit, new credit applications, payment history, total balances, and length of credit history. A good credit score is important because it can help you get awarded a higher credit limit or a higher credit approval rate with a lower interest rate. In addition, those with a high credit score usually receive more favorable loan terms.

Payment history accounts for the highest percentage of the five determining factors. Therefore, you must make payments in full and on time to build and maintain a good credit score. 

Your credit score tells lenders if you are or are not financially responsible and creditworthy.