Improving Your Credit Score

When it comes to a low credit score, understand you are not
alone.  More than 30 million consumers nationwide have a
credit score of 620 or less making it more than a little bit
difficult to be approved for credit at a low interest rate. 
Your credit
score
is the three-digit number calculated by using the
information contained in your credit report.  Your score is
designed to notify lenders whether you should be considered a
credit risk or the type of consumer lenders would want to extend
credit to.  Essentially, your score is an indication of your
financial behavior.

Improving and maintaining a good credit score can be a daunting
task, but is essential to your livelihood as a consumer.  A
low credit score can mean lenders, landlords and employers will
refuse to extend you credit, rent you an apartment or even hire you
for a job.  A low
credit score
can deny you use of a credit card, car loan,
mortgage loan, insurance and utility service and a low score can
follow you for as long as ten
years.     

On the contrary, consumers with a good credit score, 700 or
higher, will receive the best interest rates and payment terms,
allowing them to save for their future and live a more comfortable
lifestyle.  Becoming a consumer with a good credit score who
is considered financially responsible is not impossible if you
follow a few tips recommended by the Federal Trade Commission and
the Consumer Financial Protection Bureau, the two agencies in
charge of consumer affairs.   

Tip 1: 

Make an effort to pay all of your bills on time.  Even
though your credit report may not be pristine, the older your
negative accounts, the less they will affect your score.  Paying
your bills in a timely fashion
despite an already low credit
score will show lenders you are serious about your obligations and
improve your score over time. 

Tip 2:

Make an effort to keep your credit card balances low. 
While you may make timely payments each month, part of your score
includes your debt to credit ratio.  This means that if your
account balances are exceeding or close to your credit limit your
score will suffer as a result.  Trying to make large monthly
payments or not charging your maximum credit limit each month will
improve your score.

Tip 3:

Review your credit report on a regular basis to ensure its
accuracy.  The
Fair Credit Reporting Act
entitles you to at least one free
credit report a year.  Make sure to order your report at www.annualcreditreport.com to guarantee it is
reporting only accurate information.  Mistakes can and do
happen and can be devastating to your score.  Review your
report and take the proper
action
if errors appear. 

Tip 4:

Establish a budget that is realistic for you.  Keeping to a
budget will allow you to live within your means and make sure you
have money to pay your bills and not overspend having a positive
effect on your score.

If you need assistance with reviewing your credit report or
advice about
improving your score
contact SmithMarco P.C. for a  free case review.