How to improve a credit score

More people are getting credit for understanding just how important a credit score can be. These scores are not just used to obtain credit. They can also influence interest rates, car insurance rates and may even help an employer decide whether or not to hire an individual.

The Federal Reserve Board has information online, including these tips for consumers.

•Get copies of one's personal credit report and check the information.

•Go to the website www .annualcreditreport.com. This is the only authorized online source for a free credit report. Under federal law, consumers can get a free report from each of the three national credit reporting companies every 12 months.

Consumers can also call (877) 322-8228 or complete the annual credit report request form at www. ftc.gov/bcp and mail it to Annual Credit Report Request Service, PO Box 105281, Atlanta, GA 30348.

•Pay bills on time. Setting up automatic payments from a bank account can help.

•Learn how the credit score is determined. Factors include:

•Whether bills are paid on time •The level of outstanding debt and amount of available credit left

•The length of the consumer's credit history. A short history can be offset by regular payments and low balances.

•The amount of new credit applied for recently. Applying for too many new accounts can negatively affect the rating.

•The number and types of credit accounts one has. A mix of installment loans and credit cards may improve the score.

To learn more, see the Federal Trade Commission publication on credit scoring at www.ftc.gov/bcp.

•Learn the legal steps that consumers must take to improve a credit report. The FTC's "Building a Better Credit Report," available at the above website, has information on correcting errors, dealing with debt and avoiding scams.

•Beware of credit repair scams. Doing it yourself may be the best way to repair credit. The FTC's "Credit Repair: Self-Help May Be Best" from the website listed above explains how to improve credit worthiness and lists legitimate resources for low-cost and no-cost help.

For more information, visit www.federalreserve.gov.

This story is provided by North American Precis Syndicate Inc.