Keeping Track of Your Credit
A good credit history is important for getting loans and other forms of credit at low interest rates. Companies use the information from your credit report in a formula, called a scoring model, to create your credit score. You do not have a single credit score, because there are different scoring models that companies can use to come up with a credit score.
According to the Consumer Finance Bureau, your credit score will typically include factors like:
- Your bill-paying history
- Your current unpaid debt
- The number and type of loan accounts you have
- How long you have had your loan accounts open
- How much of your available credit you are using
- New applications for credit
- Whether you have had a debt sent to collection, a foreclosure, or a bankruptcy, and how long ago
Some ways to increase your credit score, or maintain your already high credit score, include:
- Pay your bills on time
- Do not spend to the limits of your credit
- One of the things credit scores take into account is how much credit you have, versus how much credit you are using
- If possible, pay off your card balance each month, both to help your credit score and to save on interest
- Be careful about applying for new credit
- If you apply for a lot of credit over a short period of time, this can negatively affect your credit score