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FICO Risk Factor Reason Codes

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When you apply for a loan or a credit card, the lender will run a credit report check on you to determine your credit worthiness. If they decide that you’re too great a risk for a loan or credit card, they’ll send you a letter in the mail letting you know that you’ve been rejected.

On the letter, they’ll list the bureau they pulled your credit report from (Equifax, TransUnion or Experian) as well as the risk factor reason codes for the risks you pose. The risk codes will be listed in the order of importance, so the higher up on the list in your letter, the more significant it is.

Ever curious what all the reason codes are? I was… so I did some digging. Here’s a list of all the reason codes as well as the number for each bureau.

EQ stands for Equifax, TU stands for TransUnion, and EX stands for Experian.

Risk Reasons EQ TU EX
Amount owed on accounts is too high 1 1 1
Level of delinquency on accounts 2 2 2
Too few bank revolving accounts 3 N/A 3
Too many bank or national revolving accounts 4 N/A 4
Too many accounts with balances 5 5 5
Too many consumer finance company accounts 6 6 6
Account payment history is too new to rate 7 7 7
Too many recent inquiries last 12 months 8 8 8
Too many accounts recently opened 9 9 9
Proportion of balances to credit limits is too high on
bank revolving or other revolving accounts
10 10 10
Amount owed on revolving accounts is too high 11 11 11
Length of time revolving accounts have been established 12 12 12
Time since delinquency is too recent or unknown 13 13 13
Length of time accounts have been established 14 14 14
Lack of recent bank revolving information 15 15 15
Lack of recent revolving account information 16 16 16
No recent non-mortgage balance information 17 17 17
Number of accounts with delinquency 18 18 18
Date of last inquiry too recent N/A 19 N/A
Too few accounts currently paid as agreed 19 27 19
Length of time since derogatory public record
or collection is too short
20 20 20
Amount past due on accounts 21 21 21
Serious delinquency, derogatory public record or collection filed 22 22 22
Number of bank or national revolving accounts with balances 23 N/A 23
No recent revolving balances 24 24 24
Number of revolving accounts 26 N/A 26
Number of established accounts 28 28 28
No recent bankcard balances N/A 29 29
Time since most recent account opening too short 30 30 30
Too few accounts with recent payment information 31 N/A 31
Lack of recent installment loan information 32 4 32
Proportion of loan balances to loan amounts is too high 33 3 33
Amount owed on delinquent accounts 34 31 34
Serious delinquency and public record or collection filed 38 38 38
Serious delinquency 39 39 39
Derogatory public record or collection filed 40 40 40

How can you use this? These all reasons why the credit card company or the lender shouldn’t give you a loan or card, so avoid these. For example, reason code 1 for all three bureaus is “Amount owed on accounts is too high,” so you should avoid carrying too high a balance because that’s a bad thing (which is obvious even without the reason codes). Just imagine you have a friend who wants to borrow money and you’ve just put yourself in a lender’s shoes.

{ 14 comments, please add your thoughts now! }

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14 Responses to “FICO Risk Factor Reason Codes”

  1. ian says:

    Can you give a little more information on ‘The risk codes will be listed in the order of importance’. The important ones will be listed on top I took to mean that they are listed in ascending order. This would mean that the most serious offense is ‘Amount owed on accounts is too high’. However, the last two on the list seem worse… ‘Serious delinquency’ and ‘Derogatory public record or collection filed’.

    Does the numeric code directly relate to the order we would see them on a report or are these just random index numbers and not related to seriousness?

  2. eric says:

    @ian

    Random index numbers.

    @jim

    May I know where you got this info from? Just curious. :)

  3. Jean says:

    After this article and checked my report, Equifax has my home equity loan listed under revolving accounts instead of mortgage section.
    It had an old payed off one with a zero balance in the mortgage equity section. I sent for a correction because I’m pretty sure with the equity loan under revolving accts lowers a FICO score. Can anyone confirm this? Thanks.

  4. Dave says:

    I came across your website and found it interesting. Wonder if you can talk about precious metals, especially silver and copper.
    I try to buy a couple of ounces per month for the future. Your thoughts?

  5. Damon Day says:

    Thanks for that Jim,

    I haven’t seen that all in one place before. I hope you don’t mind I copied it to a Word doc for reference for my clients.

  6. nick says:

    @Jean
    HELOCs are essentially revolving credit lines. So if you have a balance on them, you increase your credit line utilization…and possibly lower your FICO.

    @ian
    He meant the codes/description will be listed in a particular order on your credit report.
    If you get denied credit, you shoule get a mail explaining why you were denied and the top one or two reasons will be mentioned in it as well.

  7. Mike says:

    Some in the list are obvious, but others like:

    Number of revolving accounts
    Number of established accounts

    are not so obvious. Do these mean too many, too few? What is the optimum number of accounts?

    • nick says:

      i dont think there is an optimum number. i would think that it’s more of flag to see how thick your credit file is. for eg if the number of established accounts is 0 (or 1) then you are considered new to credit and would be ‘priced’ (apr,credit limit etc) accordingly.

  8. ellen in VT says:

    I have a fico score of 790. But my car and home owner’s insurance company charges me extra because of my credit report. (They include a notice of adverse action with the bill.) The reason – I have too many credit cards (even though most aren’t used).

    • Jim says:

      You should try to consolidate the cards if you have multiple cards from each issuer, that could reduce the number of credit cards you have but should not hurt your score (as long as you consolidate newer cards into older ones).

  9. Jean says:

    Thanks for responding, Equifax will not move my HELOC to mortgage spot instead of revolving credit. The part that bothers me it’s not descripitive that’s it’s for my home because I don’t have a mortgage on it. It looks like I have a credit line of 175,000. and no home to back it up.It must lower a FICO instead of a mortgage listed on the report. Anyone know? Thanks.

  10. Cathy says:

    When i got into a jam with credit card debt and the amounts they wanted to catch them up went up daily, I entered payment programs with some of them to get set automatic payments and lower interest. As a result they closed the accounts. I have recently gotten a non secured personal loan and would like to consolidate most of my accounts. Does it help my score more to pay off the closed ones to reduce the number of accounts or pay down the open ones to increse my available credit?

  11. LD says:

    thanks a lot for the info. that will came in handy for me.


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