The major credit bureaus, Equifax, Experian and TransUnion, are known to use your payment history (35%), amount owed (30%), length of credit history (15%), new credit or searches for credit (10%) and types of credit used (10%) to come up with a credit score known as FICO (Fair Isaac Corporation) score for you. The Bloomberg Businessweek recently reported that these agencies are considering use of other factors too. This is a direct result of the tight credit markets and the economic slump that we are facing at the moment. Among the new tools, they are looking into bank account activity; payment history of rent, telephone bills, insurance payments, utility bill payments; and payment behaviors such as whether a customer pay his or her car loan before the mortgage.
The Fair Isaac (FICO) introduced a new system for credit scores incorporating information gathered from publicly available sources and traditional credit reports. The result is more Americans almost 44 percent of the borrowers now fall into a sterling credit category of 800 to 850 levels.
Everyone should closely monitor their credit reports and any discrepancies should be addressed with the credit bureau immediately.