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What can I do to improve my score?
It's a good idea to make sure that the data each bureau has on you are consistent and up to date by ordering a copy of your credit report about once a year and disputing any inaccuracies. You also should be aware of what affects your score to help minimize the damage you can potentially do to it. People tend to get nervous when they receive credit card solicitations in the mail. However, scorers treat these solicitations as "spot" inquiries, which do not affect your score. Whenever you apply for credit, on the other hand, it's treated as a "hard inquiry" that's factored into your score. Too many inquires over too short a time can have a negative impact. But scorers make special provisions for mortgage and car loans inquiries because people tend to shop around more for these products. Overall though, credit inquiries account for only about 10% of the total score. Also, keep in mind that the main components of the score are your payment history and the amounts you owe. A bankruptcy filing can remain on your credit report for as long as 10 years and foreclosures can "significantly lower" your score. You should avoid taking on more credit than you can handle. Late payments will also work against you, so it is important to make all loan payments on time even if it means paying the minimum balance. Ideally, you should avoid "maxing out" your credit lines and strive instead to maintain low balances. This will improve your score over time, because people owing smaller amounts on their credit accounts are viewed as having a lower repayment risk than those who owe more. By carefully managing your credit, it's possible to add as much as 50 points in a year to your score. There is nothing that you can do to your credit from which you can't recover.
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