Yes, life happens! If your credit score has seen better days, it can hurt you when borrowing money. Maybe you get turned down or must pay high-interest rates.

How credit reporting bureaus calculate credit score is a little complex. In this short video, we share some things you should know if you are trying to improve your score.

1. It’s not good to have no credit cards or cancel all of your cards.
2. Conversely, don’t open credit accounts you don’t need.
3. If you have credit cards, keep the balance at less than 50% of the available balance (30% is even better).
4. Closing an account doesn’t make it go away, as it can still appear on your credit report.
5. If you’re behind on any accounts, get current, and pay on time as long as it is possible.
6. If you have an account that goes to collections, that will stay with you. In fact, for seven years.
7. Use your phone’s technology to schedule payment reminders. Better yet, set up automatic payments through online bill pay.

Remember that your credit reports and scores are critical to your financial health and play very different roles. A credit report is a statement with information about your credit activity and current credit situation, such as loan paying history. Your credit scores are calculated based on the information in your credit report. Learn more from the Consumer Financial Protection Bureau >>

First Reliance Bank is here to assist should you need help. Our customer service is as unique as you are. Please do us a favor and tell your friends about First Reliance so they can be smart about their money too.

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