Foreclosures, repossessions, and bankruptcies can cause a significant drop in your credit score. The aftermath may cause difficulty getting a car loan or an apartment lease. Luckily, with time and due diligence, you can improve your credit score. Here are several do’s and don’ts to keep in mind.

Do:

Pay your bills on time.

Making on-time payments on credit card balances and other bills can do wonders for increasing your credit score. Arrange automatic payments on the bills’ due dates so you don’t forget to pay. Lenders like to see a consistent, positive track record of payments because it shows you’re a responsible borrower who fulfills their financial obligations.

Develop a plan to pay off debt balances.

Start with debt that carries that highest balance, and create a plan for paying it off. Maintaining a balance on credit cards and personal loans can tack on interest, making it harder to chip away at what’s owed. If you get a tax refund or bonus at work, consider using most or even all of it to pay off debt. Keeping your credit usage below 30% will boost your score.

Don’t:

Close existing credit accounts.

While you don’t want to use accounts frequently, closing them can hurt your credit score. Part of your score is based on length of credit history, and whenever you close an account, it affects the average. Keeping credit card accounts open can extend this average length, which means that a new loan or line or credit won’t affect the total as significantly.

Forget to request copies of your credit reports.

You’re entitled to a free one each year from the credit reporting bureaus: Equifax®, Experian®, and Transunion®. Review the reports for any errors so you can take the necessary steps towards removing them. Contact the bureaus about loan discrepancies and suspicious activities. Removing incorrect derogatory marks on your reports will increase your credit score.

The time and effort you put into improving your credit score are worth it. First & Peoples Bank and Trust Company in Russell, KY, wants to help you get back on track. Since 1932, the community bank has provided a wide range of loans and accounts to help residents of Greenup County realize their financial dreams. To learn more about online banking and other convenient products and services, visit the website or call (606) 836-0211. For your convenience, the bank has two branches in Russell and additional locations in Flatwoods, Greenup, and South Shore.