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Your score ranges from 300–850.

Higher = better.

Here’s the breakdown:

1. Payment History (35%) → Do you pay bills on time?

Tip: Even one late payment can hurt, so autopay is your best friend.

2. Credit Utilization (30%) → How much of your available credit are you using?

Tip: Keep balances under 30% of your limit (under 10% for best results).

3. Length of Credit History (15%) → How long you’ve had credit.

Tip: Don’t close old accounts—it shortens your history.

4. Credit Mix (10%) → Having different types of accounts (credit cards, loans, etc.).

Tip: Lenders like to see variety, but don’t open accounts you don’t need.

5. New Credit/Inquiries (10%) → How often you apply for new accounts.

Tip: Too many “hard pulls” in a short time can lower your score.

Understanding the different types of credit is key to managing your financial health and improving your score. Each plays a unique role in your credit mix and demonstrates how responsibly you manage debt.

1. Revolving Credit
This includes credit cards and lines of credit. You can borrow up to a set limit, repay, and borrow again. Keeping balances low and paying on time helps strengthen your credit score.

2. Installment Credit
Installment credit involves fixed payments over a set term—like auto loans, mortgages, or personal loans. Consistent, on-time payments show lenders you’re reliable and improve your credit profile.

3. Open Credit
This type includes accounts like utilities or charge cards that must be paid in full each month. While not all are reported to credit bureaus, responsible payment behavior still builds positive financial habits.

A healthy credit profile often includes a mix of these credit types, proving you can handle multiple financial responsibilities wisely.

Credit is the trust that allows you to borrow money or access goods and services now—with the agreement to pay later. It’s essentially your financial reputation, showing lenders how likely you are to repay what you owe.

Your credit history is built over time through the accounts you open, how much debt you carry, and how consistently you make payments. These behaviors are tracked and reported to the three major credit bureaus—Experian, Equifax, and TransUnion—which then calculate your credit score.

That score influences nearly every major financial decision, from loan approvals to interest rates, rental applications, insurance premiums, and even employment opportunities.

At TwelveOne Financial Solutions, we help you understand, repair, and build your credit so it reflects your true financial potential.

Your credit isn’t just a number—it’s your financial reputation. Strong credit opens doors to opportunity, allowing you to secure lower interest rates, qualify for homes, cars, business loans, and even better job prospects.

Poor credit, on the other hand, can cost you thousands over time and limit access to the things you’ve worked hard for. Your CREDIT can impact:

Loan approvals & interest rates | Buying a home or car | Credit card approvals | Renting an apartment

That’s why understanding and maintaining good credit is essential to building the life you deserve.

At TwelveOne Financial Solutions, we help you take control of your financial story by repairing what’s holding you back and guiding you toward lasting financial freedom.

Because when your credit works for you—so does your future.

5 Proven Ways to Build and Maintain Good Credit

1. Pay Every Bill on Time
Your payment history makes up the largest portion of your credit score—about 35%. Even one late payment can drop your score significantly. Set up payment reminders, automatic drafts, or calendar alerts to ensure you never miss a due date. Paying on time every month shows lenders that you’re responsible and trustworthy.

2. Keep Balances Low (Below 30% of Your Limit)
Your credit utilization ratio—how much credit you’re using compared to your total available limit—has a major impact on your score. Aim to use no more than 30% of your credit limit on each card, and ideally keep it closer to 10% for the best results. Paying your balance in full each month can also help you avoid interest charges and boost your score faster.

3. Don’t Close Old Accounts Without Reason
Length of credit history matters. The longer your accounts have been open and in good standing, the better your score. When you close old accounts, you shorten your average credit age and reduce your total available credit, both of which can lower your score. Keep older cards open—even if you only use them occasionally—to maintain your credit history.

4. Add Positive Credit History
If you’re just starting out or rebuilding, you can add positive accounts to your report. Consider a secured credit card, a credit builder loan, or becoming an authorized user on someone else’s established account with strong payment history. Each of these adds consistent positive activity, which strengthens your profile over time.

5. Monitor Your Credit Reports for Errors

Mistakes happen—and they can cost you points. Review your credit reports regularly for inaccurate or outdated information. You’re entitled to one free report per year from each bureau at AnnualCreditReport.com. If you find errors, dispute them promptly or let a professional credit repair specialist handle the process for you.

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