Credit Management

How you manage credit influences your life. Not paying your bills or paying them late may stop you from buying the home of your dreams or getting the job you want.

Take charge of your credit by understanding how it works and remembering that good credit matters.

Credit Reports and Credit Scores

Consumer reporting agencies calculate credit scores, sometimes called FICO® scores, by using a statistical model developed by Fair Isaac. The higher your score, the lower risk you pose to potential creditors.

Scores can range from 300 to 850, with the majority falling in the 600s and 700s. There are no official standards for a “good” or “bad” score—but many creditors look at scores higher than 660 favorably, and scores less than 600 with caution.

Your credit score is part of your credit report. Together, these reflect your credit history and other information about you. In fact, a credit report can contain a lot of sensitive information:

  • Where you live
  • Your bill payment history
  • How much you earn
  • How much you owe
  • Your involvement in any lawsuits
  • Your arrest record
  • If you have filed for bankruptcy

It is important to know what is in your credit report and to make sure it is correct. The Federal Trade Commission offers information about managing your credit.

Get a Copy of Your Credit Report

The Fair and Accurate Credit Transactions Act entitles you to 1 free credit report per year from each of the 3 major consumer reporting agencies.

You are also entitled to an additional free copy of your report within 60 days of having a company take adverse action against you based on information in your report, such as denying your application for credit, insurance, or employment.

Contact the consumer reporting agencies directly to request free copies:

Equifax Credit Information Services, Inc.


TransUnion Corporation

There are a lot of credit score websites. Be aware that some are not affiliated with the federally mandated free credit report program. For one that is, visit

Correct Errors on Your Credit Report

The consumer reporting agency and those that gave them financial information about you are responsible for correcting inaccurate or incomplete information in your report. To report and correct an inaccuracy in your credit report, do the following:

  1. Contact the consumer reporting agency in writing.
  2. Notify the creditor in writing that you’ve disputed an item they’ve reported.
  3. Have the consumer reporting agency send changes to those who have received your report.

This document was prepared for informational purposes only and cannot be considered credit counseling advice or otherwise. Please see your credit counseling professional for additional guidance.

5 Simple Ways to Increase Your Credit Score

Every consumer can follow 5 simple rules if they want to increase their credit score:

  1. Make sure all the information in their reports is correct. If you have a dispute, it is best to request a change in writing and always keep a copy of the request for your records.
  2. Make it a priority to pay all your bills on time every month.
  3. Reduce your credit card balances. Aim to carry balances totaling no more than 25% of your available credit.
  4. Keep older credit card accounts open and active. Closing accounts may not increase your score. Keeping them open, and using them, can show a longer credit history while also increasing your debt-to-available-credit ratio.
  5. If you have no credit or severely damaged credit, rebuild your credit using a secured credit card.