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Essential Credit Report Tips to Enhance your Credit Report

By Karen Anderson
Published: Friday, December 11th, 2009

Your credit report is used by your potential lenders to judge if they will approve your application for credit or loans.  It is important that you take into consideration credit report tips that would enhance your credit report. 

These tips are very manageable and worth doing. Your credit record has a big impact in your life especially when you are planning to get a house or a car loan. 

The first tip is to check your credit account carefully. Your credit is used by lenders, credit card companies, insurers, landlords and employers.  Late payments and other negative accounts can remain on your Equifax, Experian, and TransUnion credit reports for 7 to 10 years. 

The second credit report tip is to understand the things that determine your credit score. Credit scores are typically based on first: paying bills on time which is very important.  You should not pay late, have an account referred to a collection agency, or have ever declared bankruptcy. This things will show up in your credit report. 

The second thing that determines your credit report is your credit history.  You should balance your credit history by timely payments and low balances because short credit history may have negative effect on your credit score 

The third thing to be seen in your credit report is your outstanding debt.  Many scoring models compare the amount of debt you have and your credit limits.  As a credit report tip, make sure that that the amount you owe is close to your credit limit, it is likely to have a negative effect on your score.

The fourth thing you should understand is the mix of credit cards and installment loans you applied for. It may affect your score negatively. However, if you request a copy of your own credit report, or if creditors are monitoring your account or looking at credit reports to make prescreened credit offers, these inquiries about your credit history are not counted as applications for credit.

The last thing to know about your credit score is how many and what types of credit accounts you have. Many credit-scoring models consider the number and type of credit accounts you have. A mix of installment loans and credit cards may improve your score. However, too many finance company accounts or credit cards might hurt your score.

Doing things legally is the best way, so the last credit report tip is to learn the legal steps to improve credit report. The Building a Better Credit Report by the Federal Trade Commission would help you to correct errors on credit reports, and more. 

The internet provides a lot of information on credit reports and credit scores. It also caters a lot of credit report tips and credit repair offers. But beware, some of these credit repair offers are scams, so it is still best to repair your credit report by yourself sometimes. And if help is needed, the Federal Trade Commission’s Credit Repair: How to Help Yourself gives information on how you can improve your credit reputation and also provides lists of legitimate resources for low-cost and even no-cost help.

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