Once you get your credit report, you'll notice that
the information contained in it is organized in sections:
your personal information, credit summary, account
information, inquiries, collections and public records,
along with summaries of your rights under state law
and the Fair Credit Reporting Act, plus instructions
on how to dispute information found in your report.
Sections
of a credit report, explained
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Payment history on account (35 percent)
Paying your bills on time is the most important thing you can do for your FICO score. Mind the due date, and make sure your payments have made it to the lender by then. Allow for seven to 10 business days for your payments to arrive, or if you're paying online, adequate processing time.
FICO score pie chart used with permission from Fair Isaac Corp.
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When to buy your credit score
Check your credit score six months in advance of applying for a large loan, says Craig Watts, the public affairs manager for Fair Isaac Corp. That way, you have time to make changes that could improve your score, such as paying down large account balances.
"For general maintenance purposes, it's a good idea to check your score at least once a year because if your score changes significantly, it's an indication that something is not right," he adds.
Checking your FICO score a few days in advance before applying will give you a number that should be close to what the lender will get, but if the lender gets a slightly different number, don't be overly alarmed. Ulzheimer says the lender could be using a score based on a different credit report. They could be using a different version of the FICO score or even an industry-specific FICO score, called an industry option score. "It's still going to be close," he says.
Scores improve gradually
"It's important to be patient with the process
when it comes to increasing your credit score,"
says Bridgforth. "Once you've fixed all errors,
are paying your bills on time, reducing balances by
paying more than the minimum payments and lowering
interest rates as much as possible, be patient and
let time work to your benefit. I know it can feel
like you're watching grass grow, but if you're consistent
with following these healthy habits, your credit score
will definitely increase and you'll be well on your
way to getting your credit straight."
 | Does your credit get high marks or do you feel like
you're flunking out? . |
-- Posted:
June 18, 2007 | |
