Many people avoid learning about their credit score or what it means until they are forced to apply for a rental or buy a home. This is one of these things where you never want to learn about your credit when you need to show it.
Here are your tips;
Know your credit scores and what is in your credit report.
Credit Score Ranking and what it means.
GREAT 750 - 850
GOOD 700 - 749
FAIR 650 - 699
POOR 600 - 649
BAD below 600
Repairing credit is like losing weight, it takes time and discipline.
Tips On How To Fix & Maintain Credit
Payment History – Contributes to 35% of your score’s calculation, this category has the greatest effect on improving your score.
Pay your bills on time. Delinquent payments, even if only a few days late, and collections can have a major negative impact on scores. If you have missed payments, get current and stay current. The longer you pay your bills on time after being late, the more your score should increase.
Older credit problems count for less - So poor credit performance won't haunt you forever.
Be aware that paying off a Collection account will not remove it from your credit report. It will remain on your credit report for 7 years.
Amounts Owed - Contributes to 30% of your score's calculation, and is easier to clean up than payment history, but requires financial discipline.
Keep balances low on credit cards and other "revolving credit“. The smaller the ratio is of current balance to credit line limit, the better; ideally you should be pay-off all debt monthly.
High outstanding debt can affect a credit score. Pay off debt rather than moving it around. The most effective way to improve your credit score in this area is pay down your revolving (credit cards) debt.
Don't close unused credit cards as a strategy to raise your score it won’t work! You will be removing credit history and may lower scores! Cut up the cards and don’t use them is often the best advice!
Check to make sure there are no mistakes on your report and dispute them. Do not leave disputes pending
Length of Credit History - If you have been managing credit for a short time, don't open a lot of new accounts. New accounts will lower your average account age.
New Credit - Do your rate shopping for a given loan within a focused period of time, so that inquiries are not spread out. Inquiries of the same type with the same 30 day period will not negatively effect your scores.
Note that it's OK to request and check your own credit report. By law, you may obtain a copy of your free credit report (not score) from www.AnnualCreditReport.comor call 1-877-322-8228