To improve credit report scores:

Pay your bills consistently and on time. And take heart that the scoring models all take into account the fact that everyone misses a payment once in a while. Also, negative information loses its potency over time: a recent late payment is weighted more heavily than a late payment four years ago. (get free reminders to pay bills timely)

Check your credit report and remove errors. When you fix credit report errors to make sure only your accurate credit history appears on your report, you ensure that the credit score it generates isn't lowered by inaccurate information. Keep your debt reasonable. One rule of thumb: for a good credit score, your account balances should be below 75% of your available credit. For example, if you have a $2000 credit limit, you should have a balance of no more than $1500. Maintain only a reasonable amount of unused credit. While it's good to have a cushion of credit available, having ready access to thousands of dollars of debt makes you a poorer credit risk. Avoid too many inquiries. Inquiries are interpreted as a sign that you have been actively seeking credit, and may be in financial difficulties or in the process of overextending yourself.

Outstanding debt: Amount owed on all accounts, i.e. credit cards or installment loans, and how close you are to credit limits. This category usually determines about 30% of your Fair Isaac credit score.

Credit history: How long have you've been building a credit history, how long specific accounts have been established and how long since you used each account. According to Fair Isaac, this category usually determines about 15% of your credit score.

Pursuit of new credit: Number of new inquiries, new accounts, and how recent they are. Whether you've made on-time payments to re-build your credit after a period of frequent late payments. According to Fair Isaac, this category determines about 10% of your credit score.

Type of credit used: Number of bank cards, travel & entertainment cards, department store cards, installment loans, etc. According to Fair Isaac, this determines about 10% of your credit score.

It's important to obtain and maintain a good credit rating. Having fair credit allows you to apply for loans and credit cards, but having excellent credit allows you to obtain the lowest interest rate and best deals.

Benefits of having a good credit rating:
* Makes it easier to get loans with good terms
* Makes it easier to get credit cards at lower apr rates
* Is important if you want to buy a home

Problems with a poor credit rating:
* Makes it hard for you to get credit
* You will probably pay higher interest rates
* You could be turned down for a job
* May make it difficult to rent an apartment or buy a home

How much you can improve your credit rating depends on your situation. Rebuilding bad credit is not impossible but it does take time and motivation. A weak credit report includes a pattern of late or missed payments.

You can begin to improve your credit rating right away by making at least the minimum payments on time. Within a few months, your credit report will show that you are managing your credit responsibilities better, and your credit rating will improve. But it may take a few years for your rating to be completely rebuilt.

As you rebuild credit to improve credit scores, keep these tips in mind:

* Try to cut back on your spending by reviewing your household expenses and deciding which are necessary. Cut out those that are not.
* Slow down your use of credit until you get caught up on bills.
*If you can't make all payments on time, call your creditors immediately and try to work out a re-payment plan.

Bad checks can equal a bad credit report score: A single bounced check may be enough to make it difficult for you to open a new account or get a merchant to accept your check as payment.

Check reporting protects financial institutions and retailers from losses. Under the Fair Credit Reporting Act (FCRA), a bounced check may stay on your record for as many as seven years.

Frequently balance and monitor your checking account to avoid bounced checks, and don't close one checking account before you have established another one. Before closing your account, make sure any outstanding checks have cleared and account fees have been paid.

After you've worked hard to improve your credit score, it's up to you to maintain that good score.