Never before has your credit score been so important to decisions that are being made about you. When you apply for a credit card, car loan, or another type of credit, this will trigger a credit check and generate multiple credit reports. These are used by a lender to make decisions about whether or not to lend to you, how much, and at what rate. Credit scores are now even used by potential employers, utility and service providers, and other companies.

It is therefore incredibly important to improve your credit score. Different credit reporting and scoring companies use different methods to assemble credit scores, but the methods are similar enough that taking certain steps can improve each of your credit scores.

First of all, you need to know who has this information. There are three major credit reporting bureaus, Experian, TransUnion and Equifax. Each of these companies has a file for you and every other person who has consumer credit. These files are assembled over time by compiling the information that credit providers give the credit bureaus. It works like this: Each time you obtain credit it goes into your file, then the lender gives the bureaus a record of the repayment of that debt.

A good example would be a car loan that must be repaid on the 5th of each month for 36 months. Over the first year, letas say that you make two payments on the 20th, while the rest were received on or before the 5th. The lender sends a report of your loan activity to each credit bureau. Each of these bureaus in turn uses a formula to compute a credit score for you, based upon that reported information.

The next step is applying to check your credit report. This is vital information a" think of it as your financial health record. There are many offers available on the internet through which you can apply to check your credit report and your credit score.

Once you have a credit report and a credit score, take a look at the information reported by your creditors. Make sure that the creditors that are reporting into your credit file are actually your accounts. If there are creditors listed on your report that you did not borrow from, you can improve your credit score by having these entries removed from your account.

Finally, review all payment histories to be sure that they are accurate. If a creditor has reported incorrect late payments, or does not show payments that you make, correcting these can greatly improve your credit score. Your credit score report will contain the addresses of the credit reporting bureaus. Just follow the instructions to write to the bureaus and identify errors in your report

Each credit bureau will investigate the error. Often it will take several letters back and forth, so keep a file of your letters and their responses. By removing incorrect late payments or other information, you can dramatically improve your credit score in a short time.

Apply as soon as possible to check your credit report, then continue to monitor it at least annually. The more you are familiar with your financial health record, the better equipped you will be to improve your credit score. Credit scoring is so widely used today that improving you score will help you in a variety of ways.