Like the formula for Coca-Cola , the FICO credit scoring formula is a closely guarded secret. The Fair Isaac Corporation, however, does give us a glimpse into the secret sauce from time to time.

For example, Fair Isaac has disclosed what factors go into its scoring model and the weight to be given each factor:

While these factors are helpful, they leave a lot of information out. For example, how does a late payment affect your score? Is it better to have a zero balance on your credit cards? And how exactly will credit inquiries lower your FICO score?

Well, I found some answers to these questions over at the[wp_shortcode_80] forums. Apparently, Fair Isaac released the following chart about the FICO formula:

It took me some time to unravel this chart. But if you spend some time with it, you’ll see that it’s packed with some useful information, particularly if you are trying to improve your score.

For example, if you have a late payment on your record, the biggest impact to your score occurs in the first five months. In month 6 you’ll see a 5 point increase, and by month 12 another 10 points.

Another thing I found interesting about this chart is the impact carrying a credit card balance has on your score. You get the biggest boost to your score if you carry a balance ranging from $1 to $99. If you have a zero balance, your score actually takes a 10 point hit. Go figure.

Finally, this gives some insight into how credit inquiries affect your score. With four or more credit inquiries, your score can drop 50 points.

Keep in mind that the actual impact on your score depends on many factors not reflected in this chart. And if you want to check your score, there are several free ways to get your credit score.


  • Rob Berger

    Rob Berger is the founder of Dough Roller and the Dough Roller Money Podcast. A former securities law attorney and Forbes deputy editor, Rob is the author of the book Retire Before Mom and Dad. He educates independent investors on his YouTube channel and at