Fourth, how much is your debt? It is okay to have debt once in a while as long as you are able to pay for it. If you don’t owe money to anyone, then good because this will be reflected on your high credit rating.
Lastly, what is your payment history? This is somehow connected with your length of credit because this will show if you have been able to make payments on time. If you missed a payment that could be bad but if you have not, then you should have a good credit rating.
All these five factors are equally important. So you can see if you have any problems, get a credit report from one of the three crediting agencies namely Equifax, Experian, and Trans Union.
You can get a copy from each one at the same time or do it at different times of the year. This report changes so you should obtain a copy annually.
One thing you might notice looking at the different reports is that they may not always reflect the same thing. When this happens, don’t be alarmed because each one uses a different set of protocols in coming up with those figures.
However, should something there be outdated or mistaken, this must be corrected. If you have the supporting documents, write a letter and send this to the credit agency.
If what the report says its true and you are in a lot of trouble, then steps have to be taken to initiate credit repair. You can do this by yourself or with the help of a counselor.
Regardless of who is involved, only one thing is certain and that paying off whatever outstanding debt you have is the only way to improve your score.
Don’t expect that your loan application will be approved if you credit rating is not very good. Do something about it because credit repair is your only option.