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Funding Your Future: 4 Ways to Improve Your Credit Score

Posted at 2:27 PM, Feb 13, 2019
and last updated 2019-02-13 16:27:18-05

We've all heard the term 'credit scores,' but do you know what they mean?

David Sant, Chief Marketing Officer with Cyprus Credit Union said, "a credit score, also referred to as a FICO score, is a three-digit number that is generated by pulling information from your credit report. It is used as a predictor of how likely you are to become dependent on your credit or fall into delinquency with your payments. It is also used to help determine whether you will be approved for loans, mortgages, credit cards and more. 90% of financial institutions in the United States use your FICO score in their decision making process. The higher your score, the better it is."

Here are David's tips and tricks regarding improving your credit score.

What Affects Your Credit Score
• Payment History (35%): Your account`s payment information. This includes any late payments and public records
• Amounts Owed (30%): How much credit you are using and how much you have available
• Length of Credit History (15%): How long you`ve had open accounts and time since account activity
• Types of Credit Used (10%): The types of accounts that you use (credit cards, loans, etc.)
Late Payments
• New Credit (10%): New credit lines you open, this also includes inquiries into new credit

Age, race, address, marital status, income and employment will not affect your credit score.

Rebuilding Your Credit
• Pay Bills on Time -Even if you are trying to save money, prioritize paying your bills because even just one late payment will hurt. After several months of consistent, on-time payment, you`ll see your score begin to rise.
• Get Rid of Small Balances - If you use several cards and have small balances on all of them, as opposed to a larger balance on one or two cards, this can actually hurt your score. Pay off all of your balances and start fresh. Pick a card or two as your go-to options and use those consistently.
• Leave Good Debt on your Report - There is such thing as good debt. This is any debt that you`ve handled well and paid as agreed
• Relax & Be Patient - Your score won`t change overnight no matter what you do, so don`t be disappointed or give up. It takes a lot longer to build up a good score than it does for a score to fall.

If you are thinking about applying for a loan soon, and you are unsure of what your credit score is, we can help. Cyprus has qualified and experienced loan advisers who can take a look at your finances and give you suggestions on how to improve your score. For more info, visit