The average American carries over $9,000 in credit card debt. For many, it’s difficult to get out of the hole. Many people make late payments; some have delinquent payments; some file for bankruptcy; others even have to go into foreclosure. These kinds of things will inevitably affect your credit rating and, subsequently, your ability to get a mortgage.

There are many ways to avoid hurting your credit score, which is determined by a number of factors including your payment history, amounts owed, length of credit history, new credit accounts, and types of credit in use.

Ten Ways to Improve Your Credit Score:

1. Pay your bills on time. Even if you’ve had delinquencies in the past, over time, they will count less if your recent history shows timely payments.
2. Keep your credit card balances low. The higher your outstanding debt, the lower your score will go. Pay down high credit card balances, starting with the highest interest rate first.
3. Check your report for inaccuracies. You may have errors on your report that can easily be cleared up. You can request a free copy of your credit report every 12 months.
4. Pay off debt rather than move it around. Consolidating your debt onto fewer cards will not improve your score because you’ll still owe the same amount. It is better to work towards paying it off.
5. Have credit cards, but manage them responsibly. Having credit cards that are paid on time is better than having no credit cards. It shows that you can soundly manage your debt.
6. Don’t open multiple accounts too quickly, especially if you have a short credit history. This may look risky because you’re taking on a lot of possible debt. It also shortens the average age of your credit history.
7. Don’t close an account to remove it from your credit record. Accounts show up on your credit report for seven years whether they’re open or closed. Closing accounts can actually hurt your credit score if you’re not paying down debt at the same time.
8. Don’t shop for a loan from different lenders over a long period of time. Try to keep it to within 30 days or less. Credit bureaus disregard inquiries for your credit report made within 30 days of each other and consider requests made within a 14 day period as a single request.
9. Don’t open new credit card accounts you don’t actually need. This might backfire and lower your score.
10. Contact your creditors or consult a legitimate credit counselor if you’re having financial difficulties. If you’re having difficulty improving your financial situation on your own, seek help. The sooner you start making timely payments and showing that you can be managing your debt responsibly, the sooner your score will improve.

If you follow these guidelines, your credit score is likely to improve. By learning to better manage your debts, you’re likely to qualify for better mortgage options in the future.

Related posts:

1. 101 Ways to Improve Your Credit Score
2. Get A Squeaky Clean Credit Score
3. Understanding Credit Reports and Scores

Tags: Credit Card Debt, Credit Cards, Credit Report, Credit Score, Improving Credit Score