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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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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?
@ian
Random index numbers.
@jim
May I know where you got this info from? Just curious.
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.
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?
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.
@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.
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?
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.
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).
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).
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.
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?
i guess since you are in a payment program you better pay down those as promised.
thanks a lot for the info. that will came in handy for me.