Check Your Credit Reports

• According to the Federal Trade Commission, you can request a free copy of your credit report annually from each of the three major credit bureaus, Equifax, Experian, and TransUnion.
  
  Your credit report provides information about your payment history, your address and any lawsuits that have been filed against you. If you've been arrested or have filed for bankruptcy, that information will also be listed.
  
  Mistakes can be made by creditors erroneously reporting that you haven't paid a bill, or you may be a victim of identity theft, where someone is making unauthorized purchases by using your credit card information.
  
  Your delinquent account is reported to the credit bureaus, and you may not be able to borrow money, qualify for an insurance policy or rent an apartment.
  
  If you find mistakes, send a certified letter, return receipt requested, to the credit bureau, stating why you believe that the information is not accurate, and that you would like the disputed information removed from your credit report. Send copies of supporting documents with your letter, and keep all correspondence that you receive.
  
  

Pay Your Bills On Time

• Pay your bills by the due date every month. If you pay late, or have your account referred to a collection agency, you'll have a lower FICO score.
  
  

Don't Have Too Many Credit Cards

• Establishing your credit history by using credit cards is a plus, but if you have too many credit card accounts, your FICO score can be negatively affected.
  
  The type of credit account that you have is also considered. For example, if you received a loan from a finance company, your FICO score may be lower.
  
  

Establish a Credit History

• If you've just received approval for credit, and haven't had time to establish a credit history, your FICO score may not be as high, but by making your payments on time, and keeping a lower balance, you may be able to improve your FICO score.