Photo by: Christian Ferrari
Be sure to have a recent copy of your credit report from all three of the major bureaus, Experian, Equifax and Trans Union so that you can keep track of your credit and check it over carefully to be sure that everything is accurate. If something is incorrect, especially if it is not in your favor then file a dispute; the credit bureau will contact the creditor and they have 30 days to respond with proof or it will be removed from your report. Many times it takes the creditors much longer to respond which works in your favor in case it actually is accurate but they do not respond in time then the negative mark gets removed anyway.
Keep in mind that approximately 30% of a credit score is based on credit balances. So, try to keep the existing balances below 45% of the limit that is available on the card. This also means that you should not max out even one card and then pay it with another since all of your cards and balances will be looked at and this is one thing that many lenders are on the lookout for.
Some companies do not report your available high credit and this can be harmful, as the lenders have no way of knowing your credit limit. Ask the company to add it to the report or consider no longer doing business with the company. Since around 35% of the score is your current payment history you need to make sure that no matter what you do be sure to make the payment always within the 30 days because over 30 reflects a delinquent payment.
Approximately 15% of the score is made up of your past credit history; if you have any older accounts that were paid on time, closed or open, do not have them removed from your report. It shows the lenders you are capable of making payments on time. And, longer credit histories also raise your score so that is another good reason to keep them on your report.
Try to maintain a good sound “mix” of credit being reported. For example, perhaps 3 to 5 credit cards, possibly an installment (for a car) and perhaps a mortgage loan rating. It shows the lenders that you are living within your means and do not seem to be over-doing it with credit.
