One other young debtors can find relief is to set budgets. Card holders need to find out how much they can afford to put towards their credit card debt, and then such sites as CNN’s debt reduction planner (http:// cgi.money.cnn.com/tools/ ) can help them distribute money to cards in such a way as to reduce debt as fast as possible.

Another important factor that makes up 15% of your FICO credit score is length of your credit history. The longer your credit history, better for your FICO score. Additionally, though, a long history with any particular lender will be good for your credit score.

4. Type of credit mix.

The fourth factor taken into consideration is type of credit mix that you have. For example, do you have only high risk unsecured type credit, or do you also have some solid secured loans such as a home mortgags? Those consumers who have a mix of credit have higher a FICO score. This fourth factor just counts for 10% of total FICO score.

5. Number of new credit applications.

The last factor in FICO rating is amount of new applications that you fill out. If you have recently filled out a lot of credit applications, this will hurt your score because it puts lenders “on alert” that something may be wrong. This part of score is worth 10%.

Lenders themselves will normally look at employment, income, length at current residence, and marital status, but these do not affect your FICO score. If you intend to borrow in future, you do need to pay attention to your FICO score. If your FICO score is low, this could lead to higher interest rates, extra mortgage insurance when buying a home, and in some cases denial of loan.

If you plan to take out a major loan, such as a home mortgage, it could be a wise move to get a copy of your credit report 6 months before you plan to apply. That will give you time to look over your history, to ensure there are no discrepancies. If you find inaccuracies, contact Credit Reporting Agency in writing. They will have 30 days to investigate it, and then correct it if they find your claims are true. You may also want to ask for a revised credit report; they are required by law to supply you with one if an inaccuracy is found and corrected.