Consumer Watch: Keep an eye on your credit score

Keep an eye on your credit score If you manage your credit well, you shouldn't be angst-ridden about achieving a perfect credit score.

You don't need an 850 FICO score to get the best rates and terms, said Rod Griffin, manager, consumer education for the national credit agency Experian. Above a certain score level, he said, it doesn't make a difference.

But, "life happens," he said.

So, it's prudent to be aware of the things that can mess up your score and cause credit grantors to think that you're a big risk.

Here are six credit score killers, according to Griffin and Bruce McClary of ClearPoint Credit Counseling Solutions in western Henrico County:

Failing to make payments as agreed. You will positively slaughter your credit score if you declare bankruptcy because you in effect say I can't pay my debts at all, Griffin said.

Other killers: unpaid tax liens, a mortgage default, a civil judgment, collection accounts, debt charge-offs and late payments. "When you make a late payment, you've essentially broken the agreement you made with the lender," Griffin said.

Payment history accounts for a whopping 35 percent of your credit score. It's the biggest killer, the worst place to mess up.

Closing too many accounts. Closing too many accounts is a no-no, said McClary. "It takes the available amount of credit that you have -- your credit ceiling -- and lowers it closer to the balance that you owe, creating a higher debt ratio."

Keep your credit utilization below 50 percent of your limit. Otherwise, your score will take a progressively bigger hit as you get closer to your ceiling.

Maxing out your credit. Spending to the max of your credit is another way of pushing up your debt ratio. "If you're maxing out your card, you're probably living right at or beyond your means," Griffin said. "That's a recipe for trouble." One emergency could trash your ability to pay on time.

Credit utilization accounts for 30 percent of your credit score. It will take a big hit if you mess up here.

Closing your oldest card. That shortens your credit history, which lowers your score, McClary said. "What you don't want to do is remove anything that helps establish your payment history, especially the length of your credit history."

Credit history accounts for 15 percent of your credit score.

Too many credit inquiries. "Each time you apply for credit with banks or lenders, they all go and check your credit report," McClary said. Most inquiries shave points off your score.

Inquiries make up 10 percent of your credit score, not such a big deal.

Not having a good mix of credit accounts. "Your credit portfolio has to be balanced just like a diet," McClary said. Your score will be penalized if you don't have a diverse mix of credit accounts, such as a mortgage, a store card, an auto loan, a couple of credit cards, a home equity line. Credit scorers like to see you handle different types of credit.

Your mix of credit accounts also makes up 10 percent of your credit score.

Contact Iris Taylor at (804) 649-6349 or . Follow her on Twitter at http://twitter.com/RTDIrisTaylor.