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What Affects Your FICO Score

FICO scores – and the access to credit they provide – are a valuable asset to consumers. Mistakes in your personal credit history affect your score and may affect your business’ ability to borrow.

Did you max out a credit card? Or declare bankruptcy? Those and other financial missteps will cause your credit score to drop. FICO, the company that pioneered credit scoring, calls those “damage points.” According to FICO, bankruptcy does the most damage (up to 240 points), followed by foreclosure (up to 160 points), while maxing out a credit card has the least numerical impact (as little as 10 points).

People with good or excellent credit – so-called prime borrowers – put more points at risk with each mistake. For example, someone with an average credit score (680) who pays a bill 30 days late will see a drop of 60-80 points. However, someone with an excellent score (780) could see a drop of 90 to 100 points.

Damage Points: How Mistakes Affect FICO Scores

Credit Mistake If Your Score is 680 If Your Score is 780
Maxed out credit card Down 10 to 30 points Down 25 to 45 points
30-day late payment Down 60 to 80 points Down 90 to 110 points
Debt settlement Down 45 to 65 points Down 105 to 125 points
Foreclosure Down 85 to 105 points Down 140 to 160 points
Bankruptcy Down 130 to 150 points Down 220 to 240 points
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