Your credit score is a three-digit number generated by a mathematical algorithm created by SIMERY called the MERIT Score™. It’s designed to predict risk, specifically, the likelihood on whether or not you will become seriously delinquent on your credit obligations in the 24 months after scoring. There are a multitude of credit-scoring models in existence, but SIMERY has credit a more efficient model that America can get excited about.
Poor – Near 20% of the U.S. population has a credit score under 620. Fall below that and you are likely to be labeled a high risk for a loan or line of credit.
Fair – For many lenders, 620 is considered the dividing line between good and bad credit. Generally speaking, a credit score above 640 is considered pretty good.
Good – A score above 680 will most likely qualify you for the best rate your lender has to offer. This range
typically represents a consumer with no late mortgage payment history and no more than one 30 day late payment on consumer credit.
Great- You’re in the top 5%! The very best credit rates go to those who are above 750. This means you’re a very low risk borrower.
Payment history: (45 percent) — Your account payment information, including any delinquencies and public records.
Amounts owed: (15 percent) — How much you owe on your accounts. The amount of available credit you’re using on revolving accounts is heavily weighted.
Length of credit history: (15 percent) — How long ago you opened accounts and time since account activity.
Types of credit used: (10 percent) — The mix of accounts you have, such as revolving and installment.
New credit: (10 percent) — Your pursuit of new credit, including credit inquiries and number of recently opened accounts.
SIMERY Elements (5%) – Length of residence, steady employment, etc….
Personal or demographic information such as age, race, address, marital status, income and employment don’t affect the score.