Video Overview: Factors that Affect your Credit Score

• A Computer determines your Credit Score
  • It is important to remember that a computer determines your credit score. The computer is impersonal and simply follows a formula. It does not take individual circumstances into consideration.
• Factors that increase your Credit Score
  • Make payments on time. Avoiding late payments will help your credit score.
  • Establish a credit history. The longer you have been making payments on time, the higher your score will become. For this reason, keep credit cards for a longer time instead of getting new ones.
  • Bank issued credit cards are best. Try and only have credit cards that are issued by major banks. The computers that determine your credit score are more favorable of bank credit cards.
  • Keep your credit card balances low. Try and keep your balance below half of your total credit limit. It is even better if you can keep the balance at 15 percent or less.
• Factors that decrease your Credit Score
  • Retail credit cards. Having credit cards from major retail scores decreases your credit rating.
  • Late Payments. The more late payments you have, the worse your credit becomes.
  • Having outstanding judgments or collections. If you have any outstanding judgments, pay those off immediately to start improving your credit. Always verify the collections section of your credit report as collections will lower your score as well.