5 Quick FAQs About Credit Scores

Ask the Expert – 5 Common Credit Score Questions and Answers

Pam Zorko, Community President West Allis-Greenfield
People are surprised when I tell them I’m passionate about credit bureau reports! But I love that they help me talk to customers about how to truly achieve financial stability. Here’s how I break it down.

1. What is a credit score, really?

Your credit score is a snapshot of how you’ve handled borrowed money. Lenders use it to gauge risk. The most widely used scoring model is the FICO score, which typically ranges from 300 to 850. The higher your score, the better.

2. What factors affect my score?

Payment history carries the most weight. Other important factors are your credit utilization (the percentage of your available credit you’re using), how long you’ve had credit, the mix of accounts, and recent applications.

3. What’s the fastest way to improve my score?

Start with on-time payments, every time. Even one late payment can make a difference. Next, look at your credit card balances. A good rule of thumb is to keep your balances below 30% of your limit. Under 10%? Even better.

Get more tips to improve your credit score.

4. Should I close old credit cards I don’t use?

When you close a card, you lose that card’s credit limit. That makes your credit utilization go up, which can drop your score. Keeping older accounts open (especially if they have no annual fee) can help your overall profile by increasing available credit and preserving that history.

5. What’s an “insider” tip most people don’t know?

Ask for a credit limit increase, but here’s the twist: Don’t increase your spending. A higher limit can instantly lower your utilization ratio. And if you’re paying down debt, keep reported balances lower by making two smaller payments per month instead of one.

I went through credit challenges decades ago, an experience that pushed me to master managing my own credit. Go ahead and ask me about my bureau score today—I’m proud of it! And if you’d like me to review yours with you, give me a call!