How To Best Use Your Free Annual Credit Score Check

Free annual credit score checks are available to every United States resident by law, from all three of the major reference agencies. These checks can be useful to anyone who is intending to apply for a loan or a mortgage in the near future, but a healthy credit report is something which needs to be built up over many years. There are no quick solutions, even if you have managed to avoid the worst black marks which can be left on the file by serious difficulties and a failure to pay back debt.

To be able to use the annual credit score check properly, you will need to have a consistent plan for improving your score and for obtaining the credit you need. You only get one look at your files every year, so there is no point in wasting this unless you have a specific objective in mind. Firstly, you will need to understand how the score is calculated and what the different percentages relate to. The two largest sectors by far measure repayments made and credit utilization. This simply means the amount of available credit and how much you are actually using.

The percentages within each category are recalculated every time an event is reported to the credit agencies. This will happen every time a repayment is scheduled to be made, and also when new credit is taken out. Searches by lenders are also recorded, and if there are too many of them within a short period of time the score can drop as a result. Be sure to only apply for credit when it is right to do so, and never apply for several lines of credit in a short period of time. Good file management will increase your score over time, simply because the length scores will keep increasing.

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If your goal is to use the free annual credit score check to monitor a long term rebuilding program, you will need to time your search properly. Allow enough time for each improvement to be registered and to show on the file, as nothing happens instantaneously. Make sure also that you use the feedback to refine your program if the results are not what you thought they would be. Start by making sure that you have an effective routine for paying bills and making repayments, and that you have a built in safety margin for when there are unexpected difficulties.

When you have done this, you can start to put into place programs which will gradually increase your credit score over time. The first step is to try to obtain one of the high interest sub-prime credit cards which are intended for people with poor to average credit ratings. It is vital that you use these cards in the right way, as the interest rates are crippling if you don't. Use the card for everyday purchases, and then pay off the balance in full every month. This way, you get the benefits of making repayments without the price of high interest rates.

Your free annual credit score check will show you the progress you are making as a result of this strategy. Your rating should be improving not just because of the credit card but because the rest of your accounts are older and therefor more highly rated. You should also receive a limit increase which will positively affect your credit utilization rating. When your ready you can then start to bring in other forms of credit to give your profile a more rounded look, further improving what you see on your free annual credit score.

 

 

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