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Know and Maximize Your Credit Score

Know and Maximize Your Credit Score

How many different numbers do you have stored in your mind right now? Birthdays, anniversaries, social security number, PINs. But what about your credit score? It’s one of the most important numbers to know because it can be the deciding factor in getting a new home, car or even a new job.

What is a credit score?

Your credit score is a number assigned to your credit history that lenders use to predict how much risk you are as a borrower. It ranges from 300 to 850—you want the highest score possible. This score is one of the most important factors used when determining whether or not to lend you money and at what interest rate.

What impacts my score?

Your FICO credit score is calculated using five major categories:

Payment history: (35 percent) — Your account payment information, including any delinquencies and public records.

Amounts owed: (30 percent) — How much you owe on your accounts. The amount of available credit you’re using on revolving accounts is heavily weighted.

Length of credit history: (15 percent) – How long ago you opened accounts and time since account activity.

Types of credit used: (10 percent) – The mix of accounts you have, such as revolving and installment.

New credit: (10 percent) – Your pursuit of new credit, including credit inquiries and number of recently opened accounts.

According to, the importance of these categories may vary; for example, people who have not been using credit long will be factored differently than those with a longer credit history. The importance of any one factor in your credit score calculation depends on the overall information in your credit report. For some people, one factor may have a larger impact than it would for someone with a much different credit history. In addition, as the information in your credit report changes, so does the importance of any factor in determining your FICO scores.

How can I build credit?

Building and establishing credit isn’t as daunting as it sounds. offers a few basic tricks to help get you started:

  1. Make payments on time. Always. Just do it.
  2. Keep your debts low. Stay well under your credit limit and only charge what you can afford.
  3. Apply for a credit card. Obtain the best card for your FICO score. If you’re starting from nothing, you may have to settle for secured credit.
  4. Don’t open a bunch of accounts all at once. Rapid increase of your credit limit and numerous inquiries into your credit looks suspicious.
  5. Proofread your credit report and alert the bureaus of any inaccuracies. They sometimes make mistakes that can be detrimental to your score.
  6. Keep credit cards open as long as possible. This raises your average account age, which makes you look good. No-fee credit cards are free to maintain, so it costs nothing to keep your account.
  7. Don’t take out cash advances.
  8. Don’t use prepaid debit cards. They will NEVER help you build credit. We promise.

Make it a habit to check your credit score annually from each of the three nationwide consumer credit reporting companies —Equifax, Experian, and TransUnion. Mistakes on your credit report can happen, and it’s up to you to report discrepancies immediately. Federal law requires each of the three bureaus to give you a free credit report every 12 months if you ask for it. Visit to learn more.