Credit Reports 101: A Quick Snapshot
- Andee Bryan
You’ve likely heard how important your credit score is when applying for loans, but what are the important factors that go into determining your credit score and what are some things you need to do to keep your credit score clean? Check out “Understanding Your Credit Score,” a C&N Library article written by Senior Loan Underwriter, George Greeley, that examines why your credit score is important, how to build or improve your credit and things to avoid so you don’t run into common credit pitfalls. Below is a summary to quickly and easily reference the most important factors in determining your credit.
Best Practices for Maintaining Good Credit
- Past payment history is the most important factor in your score, so make sure all payments are in full and on time.
- Keep revolving accounts at no more than 30% of the available credit limit. Anything over 30% can deduct points from your score.
- The longer you keep an account active and open, the better. Lenders like to see positive accounts over a longer period.
- Diversify your credit portfolio. Don’t rely on just one source to raise your score. Having a mixture of Term and Revolving loans will be beneficial to your score.
- Keep inquires to a minimum. Scores can fall 50-60 points from credit inquiries by financial institutions. However, shopping for a mortgage is an exception to this rule. Generally, customers can get several quotes from different financial institutions for 30 days. Your score will not be affected as long as it is within a 30-day window.
Negative Factors that Affect Your Credit
- Late payments, collection accounts and judgments stay on your report for 7 years from the date they were initially reported.
- Chapter 7 Bankruptcy will remain for 10 years from the first reported date.
- Chapter 13 Bankruptcy and tax liens will stay on your report for 7 years from first reported date.
- Inquires will remain on your report for 2 years, although some may only show for 90 days.
There are three main Bureaus that determine your credit score. If you see a discrepancy on your report, you should contact the correct bureau:
Andee Bryan is a Mortgage Loan Originator at C&N covering Tioga County. She earned her Bachelor's of Science degree in Business Administration and Finance from Mansfield University in 2004. Prior to joining C&N, she spent seven years as the Associate Director for Student Life and Student Transition at Mansfield University, where she planned, promoted and executed programs and events to successfully engage, retain and transition students to the university.
Upon joining C&N in 2016 as a Business Analyst, she spearheaded the development, implementation and execution of C&N’s electronic imaging project. The following year, she accepted the position of Management Trainee, in which she worked within core banking areas to gain the skills, knowledge, and exposure necessary to successfully advance as a well-rounded employee within the bank.