Sara Parker, from Utah Central Credit Union, outlines some steps to achieve that magic credit score.
1. Pay all bills on time. If you’re consistently 30 days overdue, your score can drop by as much as 100 points. To avoid late payments, consider automating the bill-paying process.
2. Think twice before closing accounts. Lenders are looking for consumers with long credit histories that have been managed well. Be judicious about the accounts you have.
3. Minimize credit-card applications. Each time you apply for credit, a lender requests to view your report. This inquiry is noted and can reduce your overall score. Don’t apply for unnecessary credit. If you’re in the market for a big-ticket item that requires a loan, avoid credit applications for 18 months prior to your purchase.
4. Keep balances low. Credit cards that are “maxed out” can lower your score. Try to spend only 30% of your credit limit. If you have a $10,000 limit on one card, keep the balance near $3,000.*
The Fair & Accurate Credit Transactions Act of 2003 entitles everyone to a free credit report from each major credit bureau once a year. This can be ordered at www.annualcreditreport.com.
For more information, you can contact your nearest branch of Utah Central Credit Union. You can find them online at www.utahcentral.com .