Boost Your Credit!

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Boost Your Credit!

Q: How do I get my credit score?

A: Three nationwide credit agencies (Equifax, Experian, and TransUnion) are required by law to provide free credit histories to anyone who asks. Once every 12 months, you can order your report — which will have your score — at AnnualCreditReport.com. After finding out your score, make sure everything is accurate. Have you closed accounts that are still listed as open? Any disputes you have should be sent to both the creditor and reporting agencies, and make copies for your own records.

Q: What credit score will keep me from getting a loan?

A: A score above 620 is considered good, but 650 is better and 700 makes you more desirable when applying for a mortgage. On the other hand, a score lower than 580 will likely give you trouble. About 35 percent of your score is based on your payment history, and any old late payments (that nasty college phone bill!) will stay on your record for seven years after the original due date. The best way to improve your score is gradually: Make all your current minimum payments on time, pay any past debts, and keep card balances down to about 40 percent of your credit limit.

Q: Will applying for more credit cards improve my score?

A: In general, a safe rule is not to apply for more credit cards than you actually need. In fact, every time you apply for a card, your score will go down by five points. But if you use it and make your payments on time, those points will quickly be restored. As long as you keep your balances low (within 40 percent of your maximum) and make all payments on time, credit cards can eventually help your score improve.

Q: How long do I have before my late payments are reported?

A: Late payments are usually reported to the credit bureaus within 30 days. However, it all depends on how often your creditor presents new information to the credit reporting agencies. Remember: Any late bill is eligible to go on your record, so unless you make arrangements with your creditor not to submit it, it’ll eventually appear on your report.

Q: I have bad credit. Have I ruined our chances of getting a loan?

A: Not necessarily. If worst comes to worst and rocky credit has turned you into the most unpopular loan-seeker on the block, think about applying for the loan under your spouse’s name only (assuming his or her credit is in better shape than yours). It’s not ideal because, with just one salary involved, you’ll have less-attractive loan options with higher interest rates. But don’t despair: When you’ve finally whipped your own credit into shape, you can add your name to the paperwork later.

Nestperts Rich DiMaggio, author of Credit Repair: What the Credit Industry Doesn’t Want You to Know; and Brette Sember, author of The Complete Credit Repair Kit

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