Credit score requirements for loans are higher than they have been in the
past, so a good credit score is more crucial than ever. In today's economy
most lenders are looking for credit scores of 720 or higher to secure a low
mortgage rate. Here are seven ways to build up your credit score so you can
enjoy the best interest rates available.
Request your credit reports and assess the situation. Credit bureaus
(www.experian.com, www.transusion.com, www.equifax.com) are
required to provide you with a free credit report every year. Nationwide
consumer reporting companies get their information from different sources,
the data in your report from one company may not reflect the same data
in your reports from the other two companies, so request all three.
Check to verify all of the information is correct. If there are any errors,
contact the bureaus immediately.
Your payment history accounts for 35% of your score, so make sure
payments are on time every month.
The amount owed is 30% of your score. A good rule is to use less than 10%
of your credit available on each individual card.
The length of your credit history accounts for 15%, so maintain your
accounts instead of closing them. You are not penalized for available
New credit is 10% of your score and every time you apply for credit an
inquiry is added to your report, which drops your score.
Types of credit used accounts for 10%. Installment loans like vehicle and
personal loans demonstrate you can manage various long and shortterm