Consumer Credit Report

Written by Scott Martin
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Lenders receive your consumer credit report with codes giving the reasons why you have a low credit score. These codes offer suggestions of how you can improve your credit score rating, such as closing unused credit accounts or paying bills in a timely manner. The score is calculated from the data available at the credit bureau as soon as a lender requests it.

How to Improve Your Consumer Credit Report

First of all, always pay your bills consistently and on time. The scoring models all take into account the fact that everyone will miss a payment once in a while. Furthermore, negative information loses its impact over time, meaning that a recent late payment is weighed more heavily than a late payment made five years ago.

Check your consumer credit report once or twice every year and remove any errors. By confirming that only your accurate credit history appears on your report, you will ensure that the credit score is not lowered because of inaccurate information. To obtain a good credit score, your account balances should be below 75% of your available credit.

You should also only maintain a reasonable amount of unused credit. It's good to have a cushion of credit available, but having access to thousands of dollars of debt will make you a higher credit risk. Lastly, avoid too many inquiries. They are interpreted as a sign that you are seeking more credit and may be having financial difficulties.

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