credit score

Want to know how to raise your credit score? Business Insider takes a look at people with high credit scores for some firsthand advice.

With the average FICO credit score estimated at 690 (the highest possible score is 850), chances are most Americans wouldn't mind some advice on how to improve.

Of all consumers, just 25 percent have managed to achieve a score of 785 or higher.

Why not ask them how they've done it?

A new report by myFICO analyzes the habits of the country's savviest debtors to find out just how they've achieved a stellar FICO score.

RELATED: Don't Get Too Excited About Wells Fargo's Free Credit Score Offer

Here's what they found:

1. They're not debt-free. On average, they carry an arsenal of about seven credit cards.

Read on for more.

If you owe credit-card debt, educate yourself with these pointers from Kiplinger about how the whole collections process works and what your rights are.

Year after year, debt collection complaints rank among the most-common consumer grievances the Federal Trade Commission receives. In fact, reports of deceptive debt-collection tactics were the second-most common complaint (after identity theft) that the FTC received in 2011.

"Debt collection is complicated, and some collectors may push the boundaries of the regulations and law to get money out of you," says Bill Hardekopf, CEO of LowCards.com. In fact, JP Morgan Chase is being investigated by the government for improper credit-card collections, he says. If you're having trouble paying off your credit-card debt, you need to understand the collection process and know what your rights are.

You have at least 21 days after your credit-card statement date to make a minimum payment. If your payment is late, your card company will report it to the credit bureaus — but you may get up to 60 days if it's your first late payment and you're a good customer, Hardekopf says. That information will remain on your report seven years after the date you first missed the payment.

If your account is 60 days past due, the late payment is noted on your credit report and your credit-card company will turn over your account to its collections department.

If your account is 90 days past due, your card issuer will repeatedly call or send letters and will likely shut down your account.

Beyond the 90-day point, your card issuer will turn over your account to a collections agency or third-party debt collector, which will contact you through phone calls, e-mails and letters, Hardekopf says. The collector can sue you and send you a summons to appear in court. If you don't show up, the collector will automatically win the case and can seize your assets or garnish your wages to pay off the debt.

Read on to find out what you should do if the collectors are bugging you.

We're thrilled to present this smart LearnVest story here on Savvy!

Forget “you are what you eat.” When it comes to your trustworthiness as as borrower, you are who you know . . . online.

Social networks are now being used by some lenders to evaluate whether you’re likely to pay them back.

The New York Observer reports that, while this methodology is still a few years away from common use by major banks, smaller institutions such as microlender Lenddo already use an algorithm based on input from a person’s various social networks to determine her creditworthiness. And more are likely to adopt the practice in the future.

Here’s the kicker: the information used by the algorithm isn’t just what you’ve made public — the banks are requiring your log-in information. Everything you can see, they can see. And they could even potentially send messages to your contacts.

Read on to find out about how Facebook can hurt your credit.

We're thrilled to present this smart Business Insider story here on Savvy!

Trying to improve your credit can seem impossible when lenders are fearful and you're strapped for excess cash.

But don't give up hope.

"Focus on where you are right now and do what you can with what you have," said Justine Rivero, a credit advisor with Creditkarma.com.

RELATED: 15 Things You Should Never Waste Your Money On

You can make progress—even on old, negative debt — and start to rebuild your credit and therefore, your future.

Here's how to do it step-by-step:

Consider debt counseling.

You'll have to close all your accounts, which will negatively impact your score in the short run, but by the time you've reached this point, you should just be focused on paying off your debts, said Gerri Detweiler, an expert with Credit.com.

Closing your accounts won't lower your score as badly as you might think.

The National Foundation for Credit Counseling maintains a list of member organizations, many of which are nonprofit and provide free or low-cost assistance.

Read on for more tips.

Is there any point to checking the credit of potential employees? According to research by Louisiana State University and two other universities, there is no link between bad credit scores and bad job behavior.

Currently, when employers do credit checks, they can only access your credit reports and not your actual credit scores. However, this information can help them figure out what kind of credit score you have. This will expose any money troubles you've had in the past, such as bankruptcy or the inability to make payments on time.

The study, which is about to be published in the Journal of Applied Psychology, collected credit scores and personality data from 142 workers and compared them with performance data given by the employers. The results were pretty interesting — low credit scores weren't related to "deviant" employee behavior such as stealing and other counterproductive behavior. In fact, there are stronger links between personalities and credit scores. Those who have lower credit scores are found to be more agreeable, while those who have higher scores are more conscientious. Both are positive traits found in good employees.

There seems to be no direct benefit to checking the credit scores of employees, but as of now, employers are still checking out your credit history. Be prepared when you're job searching by making sure your credit score is in tip-top shape — fix errors on your credit report, check your credit score for free on Credit Karma or get your free annual credit report from AnnualCreditReport.com, and do these other things to raise your score.

In the Ask Savvy community group, reader Mrs-B wonders if she should wait for her poor credit score to improve before buying a home.

I reached out to credit expert Bethy Hardeman from CreditKarma.com, a free credit management service that provides free credit scores, financial education, and personalized savings recommendations. The firm helps more than three million consumers realize the everyday cost savings of having a good credit score.

I recently got married and want to buy a house in a year. Problem is, my husband bought one about a year and a half ago (before we got married). He cannot take out another mortgage yet so it will have to be in my name. I have poor or fair credit but am trying to fix it. I messed up my credit when I was 18 (those first time savings are tempting!), let it get bad until two years ago, and have raised my score almost 70 points since March. It's still not good enough though. I have a new secured credit card which should help, but I also have three student loans in deferment. Is it better to wait for my score to improve since some negative things will be cleared from my credit report within six to eight months, or take the smallest loan out of deferment and start paying it off? We need to save for a down payment, but a good credit score is important too.

Here are some reasons why Bethy thinks Mrs-B should wait for a good credit score:

Should I buy a home, or should I wait?

First of all, kudos to you for raising your credit score 70 points in the past six months! You must be doing lots of things right with your credit. But even though it may seem like a good time to buy a house because home prices and mortgage rates are at historic lows, it’s wiser to wait for your credit to improve even more. Before you make a decision, let’s take a look at both sides:

The case for buying

First, ask yourself why you want to buy a home so soon. Is it because you want to build equity in homeownership? Do you prefer owning to renting? Is the housing market in your area ripe for buying? All of these can be great reasons to want to invest in a home.

Although renting allows you the time to save up a bigger down payment and build your credit, it doesn’t help you build any equity. Buying a home gives you that opportunity, especially because prices are low and the housing market should be shaping up in the next few years. It’s a long-term investment that can really pay off in the long run when it’s time to sell.

Read on to find out more.

Wondering how to raise your credit score? OnSugar blog Beauty and the Budget gives us some tips. Read on to find out what she has to say about credit scores.

One last thing on credit history — what's good for it and what's bad for it? Let's break it down in the final post on credit history! (Hopefully you aren't bored out of your mind by now — beauty and fashion posts will be up tomorrow!)

What Hurts Your Credit Score

1. Late Payments or Not Paying at All: 35% of your credit score is your payment history.
2. Having an Account Charged Off: If you don't pay your credit card, they will charge off your account, which means the creditor has declared that the money will never be collected.
3. Maxing Out Your Credit Card: 30% of your credit score is your debt to your available credit ratio. Try to keep your card balance as low as possible.
4. Eliminating Your Oldest Credit Card: 15% of your credit score is your credit history. However, be cautious on this one — if your oldest card has a high interest rate, an annual fee, or if you just don't think you can handle a credit card — cancel it.

What Improves Your Credit Score

1. Paying Your Bills on Time.
2. Keeping balances low.
3. Don't always closed unused accounts, a zero balance may help your score. (Refer to the exception to this rule on number four above.)
4. Get a Goodwill Adjustment. If you've been a good customer, ask your lender to remove that one late payment.

To read other great tips, visit the Beauty and the Budget blog. You can start your own OnSugar blog for a chance to be featured on the PopSugar Network.