Clean Up Your Credit

Good credit helps you to save money on loans, reduce insurance costs, and it may even help you to land a job!

Your credit history:

It’s a snapshot of your financial life. It is comprised of any loans you currently have, loans you’ve applied for, and how diligent you are in paying your bills. It also contains basic info like your employment history and contact information.

Understanding your credit score:

From your credit history, you receive a score or “rating.” This rating helps potential lenders to make a loan decision. Many lenders use FICO scores. These scores can range from 300 to 850; the higher your score, the better chance you have in getting your loan approved at a fair rate.

Five main factors go into FICO scores, and they each have a different effect on your score. Here’s the breakdown:

  • Payment history (35% of the FICO score)
  • Debt/amounts owed (30%)
  • Age of credit history (15%)
  • New credit/inquiries (10%)
  • Mix of accounts/types of credit (10%)


One of the best ways to improve your score is to pay your bills on time. Also, don’t use all the credit you have at your disposal. (If you have a credit card or credit line, keep 70% of the line open. Don’t max out all your credit sources.)

If you’re overextended, work to pay down some of your debt. Consider a debt consolidation loan or payment plan to help. Also, correct any errors on your report and review your credit report at least annually, even more frequently if you’re working to improve your score.

Need help? Call us at 616.532.9067.