myFICO: What are credit score reason codes?

SAN JOSE, Calif.–(BUSINESS WIRE)–Many factors can impact your FICO® scores, including positive and negative information in each of your credit reports from Equifax, Experian, or TransUnion. The five main categories of rating factors can help you understand the relative importance of different types of information. However, the specific impacts of a change may depend on your unique credit history.

Credit score reason codes can help you understand what is impacting your specific FICO® score the most right now. Here’s what you need to know about credit score reason codes, from myFICO.

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What are reason codes?

Reason codes are also referred to as credit rating risk factors or adverse action codes. These numeric or alphanumeric codes relate to various credit scoring factors and may be accompanied by brief descriptions.

If you check your own FICO® score, the score will usually come with reasons explaining what has the most impact on that score. They will be listed in order, with the most influential factor first. And, if the number of credit inquiries impacts your score, but does not appear in the top four negative factors, it will be included as the fifth code.

For example, if you’re new to credit, the number one factor affecting your FICO® score might be “length of time accounts have been established,” which happens to be code “14” with scores. FICO.

Additionally, you may see reason codes when requesting a credit account. A creditor can request one of your credit reports and a FICO® score based on the report to help them make a credit granting decision. When a creditor uses a credit score to make a credit decision and rejects your application or gives you less favorable terms (such as an interest rate higher than the lowest advertised rate), the lender is generally obligated, under federal law, to provide you with adverse action or risk-based pricing advice. This notice will typically contain various information about the decision, the credit bureau and credit score model used by the creditor, the potential score range, your score, and key factors that negatively affected the score.

You may have good credit and reason codes

If your score is in the 700 or 800 range, most lenders would consider your score to be very high, which qualifies you for some very attractive offers. People are sometimes surprised to see negative reason codes appear when they have a high credit score. This usually reflects when they are just timid about getting the maximum points for a given credit characteristic.

Use reason codes as a guide

Because reason codes can tell you what is currently having the greatest negative impact on your FICO® score, you can use them as a guide to better understand what is impacting your credit. Keep in mind that a single incident can be linked to multiple reason codes.

For example, you may have missed a payment in the past and have since refreshed your account. Your credit report may include several reason codes related to the missed payment, such as the date the missed payment was recent, the number of accounts reported with a missed payment, and the severity of the missed payment information.

About myFICO

myFICO makes it easy to understand your credit with FICO® Scores, credit reports and alerts from all 3 bureaus. myFICO is the consumer division of FICO – get your FICO scores from the people who do FICO scores. For more information, visit