Improving Your Credit Score

​Check Your Own Credit Score
Lenders analyze your credit scores to determine whether or not to approve a loan, including a home mortgage. Creditors are more likely to lend you the money, if they feel like you will repay it in a timely manner. Credit scores help lenders determine how much risk you are. The higher your score, the less risk they think you will be. Your credit score is the three-digit number that compares your credit performance to that of similar consumers. Scores range from 300 to 850.

You are entitled to a copy of your credit report, including a list of everyone who has requested your report within the past year. It is best to review your reports from all three credit bureaus for accuracy once a year as well as several months before applying for a loan.

​To obtain a copy of your report, visit It is important to request reports from Equifax, Experian, and TransUnion because each bureau may have different information depending on which companies have reported to them on your accounts. Mortgage lenders often look at all three of the bureaus’ FICO scores and take the middle score to assess your eligibility.
Correct Credit Report Mistakes

Your credit score is only as good as what shows up in your credit report. If there are any inaccuracies, it is important to dispute them by enclosing supporting documents in a letter to the bureau.

Always Pay Bills On Time

It is imperative to avoid late and missed payments because your payment history is the single biggest factor in a credit score, accounting for about 35% of the score. Since recent history carries more weight than what happened years ago, making on-time payments is a powerful way to rebuild your credit. If you know you will be unable to pay bills on time, contact your creditors to work out a payment arrangement and negotiate to keep the late notations off of your credit reports.

Good Credit
Keep Your Credit Card Balances Low

Pay off debt, don’t move it around. Owing the same amounts, but having fewer open accounts, can lower your score because lenders look at the total amount of debt you have in comparison to the total amount of credit available to you. The more debt you pay off, the wider that gap and the better your credit score. It’s ideal to keep your balances below 25% of your credit card limit. Another way to keep a healthy balance-to-limit ratio is to charge less. Regardless if you pay off your debt each month, credit scores do not distinguish between those who carry a balance on their cards and those who do not.

Do Not Close Unused Accounts

A credit card with a zero balance might help your score. Closing credit accounts lowers the total credit available to you, which would increase your balance-to-limit ratio and, therefore, lower your credit score. Plus, closing an account does not necessarily remove it from your report. Payment history may still be considered for scoring purposes.

Do Not Apply To Open Multiple Accounts At Once

No matter how tempting those pre-approved credit card offers are, adding accounts too rapidly sends up a red flag that you might not be able to handle your credit responsibly. In addition, a new account will lower the average age of your accounts, which is another factor in your FICO score.

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