10 Factors That Determine Your Credit Rate Score

By: Richard Lakin

Are you thinking about buying your first house? You should know that all your past history of what you have bought, and repaid are combined into one number to tell your potential lenders if you should be trusted with a lot of credit or only a little. In other words, if you've made bad choices before, you'll end up with a less than ideal house. There are some important factors that will show the strength of a person's credit rate score, which are outlined below.

1) Are you always applying for credit?

Contrary to what some people believe, applying for many credit cards can lower your credit rate score. If you've applied for many credit cards and loans it may hurt your credit report since lenders value stability. You can get these cards but as a result of this, your credit rate score will be negatively impacted.

2) Always check, and then double-check, your information.

Make sure everything is 100% correct, as this is one of the main reasons why people find they have a low credit beacon score. Many people find that their credit rate score is affected because their employment or home details aren't up to date with the three major reporting bureaus. Never underestimate the importance of these things.

3. Ask yourself if you have any accounts open that you've forgotten about.

Maybe there is an old credit card that you haven't used since 2005. You might have thought you closed it down, but in reality, it is just sitting there on your credit report. It is important to keep all of your accounts in mind, even those that you don't use any more. Having too many open accounts can negatively impact your credit rate score, so closing them down is something that could give you a boost.

4. Don't let them mess your credit up!

There's lots of information there, so errors sometimes occur. If there is a mistake within your credit report your score could be adversely affected. If you take the time to dispute any errors then your credit rating will improve, increasing your chances of getting a loan.

5. Don't be afraid to keep a watchful eye

It's a really good plan to check up on your credit report every few months. Unauthorized transactions in your name can be avoided by doing so. As well, you should have some clues of what to do to raise your credit rate score in the future. Overall, it is just a good policy to closely police your credit score rating.

6. Pay your bills on time

It may be a no-brainer for some, but others struggle to realize the detrimental effect a late payment has on a credit rating. A sure way to take a hit at your credit score is by paying bills late. Each time this happens, your report looks a little bit worse and your credit rate score takes a hit.

7. Try and pay off as much of your debts as possible.

High levels of debt can have a massive impact on your credit score. Lenders are unlikely to grant any kind of loan if your income isn't large and you are carrying a lot of debt. Consumer debt, especially, is known to be a destroyer of credit rate score.

8. Where you work and how much money you make.

Employment can have a profound impact on your credit rate score. It is vital that you make sure all reporting agencies have this information in their files. If you have a good job, then your score will likely be better, but not always.

9. Avoid major marks against your report.

Things like a collection, bankruptcy, or foreclosure will take a long time to recover from. Several successful people face difficult situations like foreclosure, but a person should monitor his credit rate score through his difficult times.

10. Missing a payment.

If at all possible, do not miss making payments on your account for any reason. At least make a partial payment, as this will be more desirable than missing the payment entirely, so pay what you can.

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Know your FICO score and understand what are the factors your credit rate score can do to use it to your advantage whenever you intend to loan, buy or invest.

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