Five Steps to a Better Credit Score and Greater Creditworthiness

Think of your credit score as a picture of your credit risk. This picture reflects your risk at a specific point in time.  The picture will not change, and will have a "life expectancy" of one to two months depending upon the lender who requires it.  When you take another picture, your scores may appear to be different to reflect the minor changes in the underlying credit information.

Here are steps that you may take to ensure that each new snapshot of your credit history reflects your best image. By observing the following guidelines, you can influence your creditworthiness for the better:

1. Check your credit report regularly
   Take the necessary steps to remove inaccuracies.  Never llow your credit health suffer due to inaccurate information. If you find an inaccuracy on your Credit Report, contact the creditor associated with the account or the credit reporting agencies to correct it immediately.

2. Be punctual
   Pay all of your bills on time. Late payments, collections, and bankruptcies have a negative effect on your credit score.  Unpaid judgments, tax liens, involuntary repossessions, and foreclosures have devastating long-lasting effects!

3. Watch your debt
   Keep your account balances below 50% of your available credit. For instance, if you have a credit card with a $1,000 limit, you should try to keep the balance owed below $500.  Maintaining balances below 30% of the credit limit is preferred, and maintaining a credit balance near zero percent of your limit will actually generate points! 

4. Give yourself time
   Time is one of the most significant factors that can improve your. Establish a long history of paying your bills on time and using credit responsibly. You may also want to keep the oldest account on your credit report open in order to lengthen your period of active credit use.

5. Avoid excessive inquiries
   A large number of inquiries occurred over a short period of time may be interpreted as a sign that you are opening numerous credit accounts due to financial difficulties or overextending yourself by taking on more debt than you can easily repay.  "Hard credit inquiries" can cost up to a 5 point drop in your credit scores.  Some hard inquiries may remain on your credit reports for up to two years. Multiple mortgage inquires will be considered as a single inquiry over a fourteen (14) day period.  Performing your own (soft) inquiry does NOT register as an  inquiry on your credit profile.