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An individual's credit score typically ranges from 300 to 850 with scores above 620 considered desirable for obtaining a mortgage. Buyers may qualify for an FHA loan with a score of 500–580, depending on the size of their down payment. The following factors affect your score:
Your payment history.
Have you paid your credit card bills on time and paid off installment debt? Bankruptcy filing, liens, and collection activity also affect your history.
How much you owe and where.
People sometimes spread debt among several accounts to avoid approaching the maximum on any individual credit line. Not a great strategy. if you owe money on numerous accounts, it can indicate that you're overextended.
The length of your credit history.
In general, the longer an account has been open, the better.
How much new credit you have.
New credit, whether in the form of an installment plan or a recently obtained credit card, is considered more risky, even if you pay down the debt promptly.
The types of credit you use.
Generally, you build up your credit score by having more than one type of credit, such as installment loans, credit cards, and a mortgage.