How to Make Your FICO Score Work for You

Fair Isaac is the company that came up with the original credit scoring model and it is still used today by all of the major credit bureaus. Your credit score is an important number as it can play a role in many areas of your financial life. Your insurance premiums, rental deposits and interest rates can be impacted by it. Getting your FICO score on an upward trend can significantly improve your financial life in the long-term.

Instructions

1

Get a copy of your credit report from each of the three major credit bureaus. TransUnion, Experian and Equifax all use the FICO scoring model and they all have different information from your creditors. Examine each credit report to see exactly what is bringing your score down. Most credit reports give you some type of information as to the factors that are contributing to your credit score the most. This will give you a place to begin your efforts to build your score.

2

Start making all of your bill payments on time or pay them before they are due. If it helps, you can set reminders on your computer or phone to make sure that you pay your bills on time. In some cases, you may be able to set up automatic bill payments so that your bills are deducted from your account at the appropriate time. Your payment history makes up a large percentage of your credit score and by making your payments on time, you can bump up your scores.

3

Pay down the balances on your debt accounts as much as possible. Another important factor in evaluating your credit score is the amount of debt that you have in relation to the available credit. If you can get the amount of debt down below 30 percent of what you have available, it will reflect positively on you with the credit bureaus. This might take some time to accomplish, but it can make a big difference in your score.

4

Use your credit responsibly whenever you get the chance. This can include opening a credit card account and making small purchases. Then when you get the bill for your credit card, make the payment immediately. You should also strive to get a good mix of credit. For example, if you have different types of credit like credit cards, a mortgage and an auto loan, this helps boost your score. Many people who have poor credit scores never use their credit and it ends up lowering their score even further.