An open account can work for you or against you depending upon how many and how many with balances. Too many open accounts with balances will cost your credit points and lower your credit score. The number of open accounts should be no more than about 20 and no more than about 8 open accounts with balances. This will include revolving and installment accounts with balances. As a rule of thumb, keep installment accounts at the same ratio as revolving accounts.

Open accounts are accounts that you have opened by going to a creditor to get a loan for a product or service. These can have a balance or you can pay them off each month. It can be a revolving account (an account that has no payoff date and the payment varies depending upon the balance owed) or an installment account (an account with a set payment and a set payoff date). Open accounts are necessary for a good credit score but too many open accounts can be bad for your credit score also. There is a balance that needs to be in place.

Watch Out when moving. The average family moves every 3 to 5 years in the United States. This is when most of the mistakes happen on your credit file. Moving can be especially hectic and cause a great deal of damage if not taking precautions to make sure your bills are taken care of and address changes made in a timely manner. Change of address can take up to a month to take place and then the postal service can hold the mail for a week at a time before they send it to the new address. It would be much better to change the address with each creditor as soon as you know when you will be in your new home so that the statements will arrive in a timely manner and you won’t be late or with a lost statement. Remember, it’s up to you. Keep a list of your bills and who should be sending you a statement by when. I know it takes some extra time and effort, but your good credit score is well worth the effort. This is how you got the best interest rates in the first place. Don’t gamble with your credit score!

Past Due Balances are amounts on our credit report that should be checked for accuracy. We can always dispute these amounts, but the fact is that the creditors don’t care and usually won’t respond. But it would be to your benefit to dispute the fact and get the past due balance amount removed.

A collection will also show as a past due balance and needs to be taken care of quickly. After a collection, judgment or late is paid, we need to be sure the past due balance has been removed and reflects a $0 amount.