Here are 5 tips that can help you raise your score:

1) 35% of your scores are calculated by your payment history. Try to make them on time. Not doing so will decrease your scores.

2) Keep credit card balances low. High outstanding debt can pull down your score. 30% of your scores are calculated by the amounts you owe. If you do have high balances it can cause your credit scores to decrease. So you have two options, either pay the balances down or apply for new credit. To apply for an unsecured line of credit please visit http://www.epublishingusa.com.

3) Check your credit report for accuracy. 75% of credit reports contain errors. This can hurt your credit score.

4) Apply for credit. Applying this technique can help boost your scores drastically. If you would like further information on applying for credit, please check out some video tutorials that can help you at http://www.AttractiveCreditSecrets.com.

5) Do not run your credit unless it is extremely necessary.

This is a guest post from Juan at attractivecreditsecrets.blogspot.com.

For millions of people every day, bait is sent through the mail.  By bait, I mean credit card offers and businesses like CitiFinancial trying to loan you money.  While borrowing money is a fact of life, the type of borrowing you do can lead to a bad credit rating.  Here are some simple guidelines as to what types of credit are good and ones to avoid: 

Good Credit 

A good credit rating comes from creditors analyzing the type of debt you have.  Common types include fixed, like school loans and mortgages, and revolving, whose star is a credit card.  A good credit rating gives you more buying power; however, the number is not the only factor that is examined when you are trying to borrow.  You may have a high credit score, say above 750, but your score may be based on a small amount of credit.  It is easy for college students to begin with a high credit score because they do not have big ticket items on their credit report.  For someone with a long credit history, it is possible to maintain your good credit score once you are offered credit.  I’ll get into this more when I talk about when to borrow. 

Bad Credit 

Unfortunately, more people today are plagued with a bad credit rating.  And at times, it is not your fault.  For example, with the economy not doing so well lenders have started ending a relationship.  After I paid a credit card off, I received a letter in the mail stating that the company was choosing to close my account.  While it is not going to kill my credit score, creditors do not like to see numerous closed accounts.  Bad credit ratings can also be cumbersome to consumers who choose to buy a lot in a short amount of time.  Let’s say you just graduated from college and have landed a nice job but need to relocate.  Your college car isn’t going to make it, you are choosing to buy a home instead of renting and you need to furnish your home.  In a short amount of time, you are going to need to make some large purchases.  You see an advertisement for “6 months same as cash,” or “no interest for the first year” and are pulled in to using credit to make those purchases.  There is nothing wrong with taking advantage of those programs.  I’ll explain why in the when to borrow section.  However, making those types of purchases quickly may affect your credit score.  While it seems you are being punished for having a job and choosing to borrow, it will pay off as you establish your consumer history. 

When to Borrow 

There is one question you should always ask when you are thinking about borrowing: “Can I afford this?”  When deciding to buy don’t look at the price per month, look at the total cost of it.  It seems more feasible to see $279 a month instead of $17,000.  Another trap retailers don’t share is a price on a window (for a car perhaps) is for someone who has a good credit score.  You may end up paying a lot more than $17,000 for the car that was only $279 a month. 

Another way to determine if you are ready to borrow is to figure out if you can pay the balance off after you have borrowed.  Credit cards make money if you don’t pay the balance off.  Make sure you can pay the money back each month, and on time to ensure your credit score stays strong and your interest rate is never a factor.

 To conclude, don’t borrow what you can’t afford.  It is amazing to hear teenagers say, I’m going to move out because rent is only $150 a month and I make that in a week at my after school job.  Young people forget that with rent comes utilities, maintenance and furnishings, not to mention the extra things you need to keep your apartment nice.  So, borrow when you know you can meet the terms and always pay it back, in full.

You’re driving and you happen to pass by one of those suburbs just to avoid traffic. You see a house with a for sale sign on the lawn. You’re just dying to own a house and have been thinking a lot about leaving your apartment. You finally decide that you want to get it, so you look to some financial institutions to provide financing opportunities like loans or mortgages to help you in the purchase. There’s one big catch though: you don’t have a high enough credit score…

A credit score is a term that’s probably not new to you, but the idea of getting a high one is often difficult to understand. Rates on loans are mainly based on how good your credit score is and your ability to pay your obligations. Banks or lenders view your scores all the time, and having a good score is the only way to get financed for much of anything. Thus, the higher your score, the greater your financing options can be, both in terms of availability and rates.

The credit score was developed by the Fair Isaac Corporation (FICO) as a credit model representing how well a person handles his/her finances. The score is computed by determining an individual’s credit payment history, and each punctual payment causes a rise in a person’s credit score. The time of payments is a huge chunk of the final credit score. Credit history length and types of credits used are also factors in a person‘s score. Negative factors that pull down your overall credit scores are payment default and bankrupt history.

How to get or maintain a good credit score

Payment history is 35% of your credit score. Make timely payments on any loans that you have. Payments which are delayed or defaulted pull down your credit score significantly. It is important that you maintain good standings with your creditors and have good personal finance discipline so that your score isn’t affected by poor payment history.

Your amount of debt represents 30% of the score. If you really want to get a good credit score pay off your existing loans and debts ahead of time. If you have an existing loan on your car, for example, the amount of debt from that vehicle is counted as part of your income and properties. The sooner you pay it off, the better your credit score will look.

Length of credit history is 15% of your score. It is not enough that you have no outstanding payments, but you should also show that you’ve been borrowing money for a long time and have good standings with your creditors. This might seem like a catch 22 because you have to pay stuff off early while still maintaining some time on it, but you really have to have both to keep up your score. A lot of financing won’t show up as a score until you’ve had it for over a year, so perhaps the best option is to make regular payments for at least 12 months and then pay off things early. A personal finance management system can help you keep track of your finances so that you can figure out how much extra money you can allot for future payments.

Recent credit history represents 10%. Lenders will look at transactions that you’ve made in the recent past as an indication of your current financial situation. That’s why it’s always important to keep up with your payments because a few missed ones could mess up your credit score at any time. At the same time, bad credit history may be offset if a person shows that he has significantly made improvements in payment of credit. Use that as a chance to redeem yourself.

Analysis of borrowers credit makes up 10% of the score. This comes from a mix of credit that the borrower holds, such as leases, mortgage, car loans, installments and credit cards. Having a variety of sources will improve your credit overall.

Final thoughts

To get the best deals on much of anything, it’s important that you maintain a good credit score. With this simple breakdown of what makes up a credit score, you already have a good idea on where your credit score stands. Budget tools are available for keeping track of expenses. One thing to note though is that opening multiple applications could also pull down you credit score, so be sure that before you apply for something, you have a rough idea of your chances for financing. If you get several no’s in a row, you’ll severely decrease your chances for financing, so avoid a credit pull when you can. Know the banks rates and compare which one gives the best deal.

Before making any big decisions such as purchasing a car and getting that house you’ve always dreamt of, prioritize which is more important. Online budget planner’s are available to help you figure out which one you might be able to afford, but only you can determine which one you really want. Both require long term commitments and affect your credit score. Having an existing car loan pulls down your credit score because it affects your paying power or debt to income ratio. Inquiries on car dealerships generate credit inquiries and also affect your credit rating. Maintaining a good credit score gives you the option of getting the best deals in the market. But the best thing about maintaining that good credit score is gives you financial maturity and makes life a little bit easier.

 Even with the best of intentions, credit cards can lead to bad trouble. Whether impulse control or financial desperation is the culprit, many people end up in a pickle over credit card debt. New laws to curb sneaky industry practices were passed late last year; unfortunately, they won’t go into effect until July 2010. In the meantime, credit card companies are using every trick in the book to get more of your money, even blaming the economy as the reason for their shady policies. The industry’s talking heads make it seem like every Tom, Dick, and Harry is defaulting on payments, although recent reports confirm that just 9% of card holders are in default.

 Don’t feel bad if you’ve fallen for the alluring trap of seemingly free money. Many Americans do. As reported by the Associated Press, CreditCard.com found that the average outstanding U.S. credit card debt per household was $10,679 at the end of 2008. Furthermore, data from the New York Times reveals that 40% of American families carried a recurring monthly credit card balance in 2008 and that the average household had 13 cards.

 Things have only gotten worse in 2009. The credit card companies have chosen to play hardball with consumers in order to protect themselves from future losses, in some cases demanding credit scores of 740-750 for the privilege of charging your next purchase to their piece of plastic. Other tactics include increasing penalty fees, upping interest rates, and slashing credit lines, even for cardholders who have good credit and always pay on time. This is in addition to existing aggravations like the universal default rate, which will be eliminated in 2010 but for now allows companies to increase your interest rate if you pay late on ANY of your bills, even if the late bill payment was on an unrelated account.

 What all of this means is that you should limit your credit card usage (but don’t close your existing accounts), at least until the consumer-friendly 2010 laws go into effect. For starters, don’t make any new credit card purchases unless: a) it’s an emergency; or b) you can afford to pay off the balance in full. Also, pay off any existing balances as quickly as possible to avoid paying unnecessary fees. For example, let’s say you have a $5,000 credit card balance with a 14% interest rate. If you only make monthly payments of $100, it will take you 6 years and 4 months to pay off the balance, plus cost you $2,548 in interest fees. However, increasing your monthly payment amount to $500 allows you to pay off the balance in 11 months, which lowers your interest fee costs to $348 – a savings of $2,200.

 In addition, plan to periodically review the fine print of your credit card agreements in order to stay on top of changes to your interest rate and/or credit limit. Card issuers can change agreement terms at any time, and they’re only required to give you 15 days’ notice of these changes. Finally, make sure your credit card balance stays under 30% of your credit limit. Going above this amount may lower your credit score and increase your interest rate.

Most banks have set rules on how to qualify a borrower for the best loan terms, and those rules almost always place a major emphasis on your credit score. If their best rates are offered to borrowers with a score of 700 or higher and yours is a 697, those three points could cost you thousands of dollars when it comes to financing!

According to myFICO , the consumer Web site of the Fair Isaac Corp. that created the FICO score (the most commonly used credit score), the interest rate difference between those two scores is one-half percentage point. You may also enroll for their great monitoring service. Just click on the link.

There is several ways and variables that play into an individual score make it impossible to say that one particular action will increase a given score by a certain number of points. Sometimes, I have great results when a borrower pays down a credit card or pays off a collection; other times, it makes very little difference. But there are at least some good guidelines to try and follow.

Here are some tips I’ve picked up along the way:

1. The fastest way to a great score is pay your bills on time, keep account balances low, and take out new credit only when you need it. This is mainly about plain old common sense. People who do these things faithfully usually have very high scores. To lenders, high scores signify that you are being conservative and cautious about credit. In turn, they see you as a lower risk borrower and will reward you with much better terms and a much lower interest rate.

2. What if you’re house hunting and you just need a few extra points to bump you over the line to the great rates? Start by having your mortgage broker pull your credit report and your credit score to see where you are. If your score is above a 720, you’re golden. Even 700 is going to get you good terms. Improving your score from, say, a 720 to a 740 won’t get you better terms, though, so don’t waste your time doing that. Just continue to follow the guidelines above.

What you’re really looking for on your report are factors that could be negatively affecting your score. Look for errors in the report, such as accounts that aren’t yours, late payments that were actually paid on time, debts you paid off that are shown as outstanding, or old debts that shouldn’t be reported any longer (negatives are supposed to be deleted after seven years, with the exception of bankruptcies, which can stay for as long as 10 years). Every time I meet with a client, I go over their report with them to ensure that the information is correct. I can’t tell you how many times there has been old or downright incorrect information in the report! 75% of credit reports contain errors. Hmmmm!!

After repairing errors, the fastest route to a better score is paying down balances on credit cards; in my experience, it’s possible to increase your score up to 200 points or more in 90 days  by paying down your credit lines because it helps your debt to credit ratio. 30% of your scores are calculated by how well you manage that area. If you can’t pay them down then you must apply for new credit to offset your debt to credit ratio. What that means is that, the credit scoring system looks at all your credit card limits and your credit card balances and calculates what your credit limit vs. what your balances and shoots out a percentage. So for example, If you have a credit card limits that amount to $10000 and you owe $8000 on them, you are at 80% of the credit limits. Your debt to credit ratio in that case is at 80%. Typically you want to be at 30% or less. From now on, do your best to pay your bills on time (or ahead of time) and keep your balances as low as possible. After 12 months the scoring module becomes immune to that late and your credit scores are not affected.

3. One thing you shouldn’t do if you’re just trying to boost your score is close unused accounts. If someone tells you to close unused accounts to improve your score, don’t listen. It won’t help you and it can hurt you.

Closing unused accounts without paying down your debt changes your utilization ratio, which is the amount of your total debt divided by your total available credit. You appear closer to maxing out your accounts. That’s why your score can drop. It doesn’t mean people shouldn’t close them, but don’t close them to improve your score.

If you do cut up cards, though, leave the oldest one open! The length of your credit history is another factor in your score. If you close the account of the credit card you got when you were a freshman in college and leave open the ones you just got within the last couple years, it makes you look like a much newer borrower.

Bottom line:  know that you’re not powerless when it comes to your credit score. There are a lot of things you can do to improve your score and you need to understand what your credit is like now and what’s influencing your score today. Then you can go out and get that amazing interest rate!

This is a guest post by Juan at http://attractivecreditsecrets.blogspot.com/

To learn more visit http://www.AttractiveCreditSecrets.com

The Fair Credit Reporting Act, a federal law, is the key to rebuilding your reports. This law was designed primarily to protect you, the consumer, from abuse by the credit bureaus. It’s estimated that over 90% of the reports maintained by the 4 major bureaus, Tran Union, Equifax, Experian and Innovis contain inaccurate information. Information that STOPS good people like yourself from getting the things in life you need and deserve. You may recall Experian was formerly known as TRW… aka The Report’s Wrong! Makes you wonder, doesn’t it?

The F.C.R.A. gives you the right to literally challenge the validity of any information the bureaus maintain in your credit file. For example, let’s say you have repossession on your credit. Under the F.C.R.A you have the legal right to challenge or dispute the accuracy of this information.

The F.C.R.A. states that any information contained in your report must be 100% accurate and verifiable or it must be *deleted*!

Think about that statement for a moment “100% accurate and verifiable.” When you consider the fact that each bureau contains 10’s of millions of reports that are constantly updated, you begin to see just how easy it is for mistakes to occur.

Add in the factor for human error and your report is certain to contain incorrect information. If the incorrect information is negative you can dispute it and get it removed. According to the F.C.R.A., if the bureaus cannot verify an item within 30 days, they must delete it from your file.

All you have to do is take advantage of this inherent flaw in the credit system and you’ll quickly begin to see dramatic improvements in your credit. These improvements will allow you to buy homes, new cars and get new credit.

I’m a fanatic when it comes to testing. Over the years I have diligently tested and refined all of our dispute letters for maximum effect.

What this means for you is that you can restore your credit in the least amount of time and then move forward with your goals.

This is a guest post by Juan at attractivecreditsecrets.blogspot.com.