Getting Your Credit Score Up

If your credit score is in the 730 range, you fall in the upper echelon of consumers in the U.S. with excellent credit. The average credit score or FICO score is around 690. And, with the economy slowly going downhill, more and more people are finding their credit scores drifting into dangerous territory - 550 or less.

If your credit score is low, it is in your best financial interest to try your hardest to bring it up. Doing so will save you thousands of dollars and more in the long run. Bringing your credit score up is not too hard to do, if you know the factors that determine the score. Here are some tips to help you.

Limit the number of credit accounts you open up. Credit companies are always sending offers through the mail, many of them quite tempting. As a result many people find themselves signing up for a new card offering cash back rebates, frequent flier miles, or other incentives. Beyond a certain threshold, however, each additional card or credit line you open up will cause your credit score to take a dip. If you have a lot of cards and want to get your credit score up, start to cancel some of the cards that you really don't need.

Applying for too many credit accounts in a relatively short period of time can ding your FICO score as well. For example, applying for 4 credit cards over the course of a 3 month period will raise some red flags. However, multiple inquiries against your credit file in a thirty day period for an auto loan or a mortgage will not cause your credit score to be lowered. In cases like this the credit companies realize that the inquiries all relate to the possibility of opening up only one credit line and therefore, internally, they will treat these collection of inquiries as only one.

Don't go over you limit on your credit cards. This is another red flag that will cause your FICO score to be lowered. Try to pay off your debts as quickly as you can and try to avoid rolling over balances from month to month.

New credit accounts in general tend to lower your score a bit. Over time, however, as these accounts become aged, assuming that the accounts have been handled responsibly, your score will improve. All of these tips can go a long way towards helping you to build a positive credit history and getting your FICO score into a healthy range.

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