Everyone who has ever used credit - taken out a loan or used a credit card - has a credit score. Chances are you know this, but you might not know how this credit score is figured. Keep on reading, you’ll learn.

Your credit score, sometimes called a FICO score, is figured by five main ways:

Payment History: Your payment history accounts for 35 percent of your credit score. Payment history includes late payments, impartial payments, missed payments, and how long it’s been since you’ve had delinquencies. When it comes to these delinquencies, the focus lies on how recent, how frequent, and how severe. For instance, being a month late will be looked at more favorably than being two or three months late.

For people who have never missed or been late on a payment, a good credit score isn’t guaranteed. Payment history is just a slice of the overall pie.

The Amount You Owe: The amount of debt that you are in is an important part of your credit score. It accounts for 30 percent. This not only looks at the actual number (such as $5,000 of debt), but it also looks at the type of debt, such as student loans, home loans, car loans, or credit cards.

Credit score also takes into consideration your credit limits and how close you are to reaching these limits. For instance, if you have a $10,000 limit on your credit card and you have $9,000 in debt, your credit score will be lower than if you only had $5000.  Even people who pay off their balance every month can be hurt by this: lenders report (to the credit bureau) on a specific day. If this day happens to fall before you’ve paid off your balance, your credit score may be affected. Thus, even if you do pay off your credit cards every month, never max them out. Try not to even come close.

The Amount of Time You’ve Had Credit: Next comes the amount of time you’ve actually had credit. For some people this could be years, for others it could be months. Regardless, amount of time accounts for 15 percent of your score. In a nutshell, the longer you’ve had credit, the better your score usually is.

The reason for this is simple: if you’ve only had credit for a few months, your track record has yet to be truly developed. But, if you have had credit for 10 years - and paid your bills on time - your track record has been established. Thus, lenders feel good about lending to you.

Your Application Process: Accounting for 10 percent of your credit score is your application process. For example, if you apply for several credit cards over a short amount of time, you may come across as desperate - or in some kind of financial trouble - this can hurt your score. Usually, your application process is judged by the following points: how many accounts you’ve applied for, how much time has passed since you’ve applied, how many new accounts you have opened, and how long it’s been since you last opened an account. When shopping for a home or car loan, as long as you do your shopping in a fairly concentrated period of time, it shouldn’t affect the score used for your application.

Your Types of Credit: Finally, your credit score is dictated by the types of accounts you have open. This makes up 10 percent of the total score. A good credit score is rewarded when you demonstrate having a mix of credit, rather than just one kind, such as no mortgage loans but twenty five credit cards.

Your credit score is an important number to know. Though the actual number can differ depending on what credit reporting agency is queried, it probably won’t differ that much. A good credit score can help you as much as a bad credit score can hurt you. Knowing how this score is figured arms you with the tools you need to keep your number where you want it to be: high.