Avoiding Red Flags on Your Credit Report

Believe it or not, most consumers out there have no idea what their credit score is. If you’’re one of them and are currently thinking about getting a new loan or credit card, it’s probably a good idea to check out the contents of your credit report first.

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If truth be told, experts advise consumers to check their credit reports every year in order to ensure that there are no inconsistencies, as well as to look out for possible identity theft issues. Fortunately, you can access your credit report online for free and review it for accuracy.

Click here to get your free credit report

What’s in Your Credit Report?

Have you ever wondered what most creditors look out for when it comes to your credit report? It’s common for creditors to take notice of any late payments or defaults shown on your report. Some other items that creditors may look at on credit reports include the following:

  • The total number of credit cards you have
  • Your outstanding balance compared to your credit limit
  • On-time payment history

Another major factor that creditors focus on when it comes to analyzing credit reports is your debt to income ratio. Your total credit card debt plays a significant role in determining your actual debt to income ratio. How? Well, the outstanding amount you owe on your credit cards directly affects your credit rating. Therefore, if your debt is greater than your income, your credit score will automatically drop. There are several factors that contribute to determining your credit score and if it does happen to be low, you don’t have to panic because there are ways for you to improve it on your credit report. For example, lowering debt is one of the most effective ways to repair both your credit score and debt to income ratio.

In the end, having a good credit report really comes down to how effectively you are able to manage your finances. If you’’re having trouble with your credit, you can always consult with experienced credit counselors. They can help you manage your money and give you helpful tips to increase your credit score.

Click here to get your free credit report