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Granite State ranks 2nd in nation when it comes to credit scores

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With the average credit score in the U.S. being 695 using the VantageScore model, just below the start of the good credit range, the personal-finance website WalletHub analyzed the average credit scores of residents in all 50 states and just released its report on 2022's States with the Highest and Lowest Credit Scores, along with expert commentary. Below, readers can see highlights from the report, as well as expert commentary.

The average credit score in New Hampshire is 719, which ranks 2nd highest in the U.S.


Expert Commentary

What are the best ways to build credit?

"Be patient. Building good credit takes time. You must be consistent with your bill payments. Take the necessary steps to avoid derogatory marks on your credit report. For example, if you are not able to make a payment on time, reach out to the lender, and ask for an extension. If you visit the Doctor's office, be sure to open all mail that comes from that office to make sure you do not miss a bill. Monitor your credit report to make sure everything looks accurate. Understand how credit utilization, a general rule of thumb is to keep your utilization below 30%, but the closer you are to zero, the better it is."
Philip Gibson, Ph.D., CFP® - Associate Professor, Winthrop University

"Make sure you pay your bills on time. For credit cards, pay them off every month and, even if you cannot pay them off every month, keep your balances low. Keep your other outstanding debt lower as well and pay it off. More outstanding debt makes you look riskier to potential lenders. Also, for credit cards, especially for younger people, become an authorized user on someone else's account like a parent (who has good credit practices)."
Bradley Allen Stevenson - Associate Professor, Bellarmine University

What are the most common misconceptions about credit scores?

"Although the law changed years ago, some people still mistakenly believe that if they request a copy of their credit report it will hurt their credit score. Obtaining your own report to inform yourself about what is on there and to dispute inaccuracies will not affect your score. Another misconception is that you can do nothing in the face of inaccuracies in your report. Consumers have the right to dispute inaccuracies, and the process is not complicated (although it can take some time to resolve the issue). The rate of errors on credit reports is known to be significant. This could be due to identity theft, but it also happens simply because people misspell names when they type in information sent to credit reporting agencies and because computers can confuse two people with the same name. Unfortunately, the law does not give credit reporting agencies and creditors who provide erroneous information sufficient incentive to double-check and avoid such errors on their own, and so the consumer must raise a dispute."
Lauren E. Willis - Professor & Associate Dean for Research, Loyola Marymount University

"People sometimes think that wealthier people automatically have higher credit scores. Income does not affect your credit score and it does not follow that wealthier individuals have better credit scores. What does really matters is paying your bills on time and how much debt you have."
Bradley Allen Stevenson - Associate Professor, Bellarmine University

What are the most common mistakes to avoid when trying to improve your credit score?

"The act of closing a credit card account does not positively impact your score. Recall, credit utilization is a major factor in credit score calculation. Closing a credit card account will reduce your total credit limit. Assuming nothing else about your credit history changes, the closing of the account will increase your credit utilization score, which may hurt your credit score. Changing your credit score cannot happen overnight. Typically, it may take 30 to 60 days to see a big change from any actions you took to boost your credit. This means you cannot wait until the week before you want to obtain a mortgage or an auto loan to try and improve your credit...Do not try and open too many new credit or loan accounts at once. Typically, your credit score will be hurt any time a potential lender pulls your credit report...Opening several accounts at once may hurt your score each time a different account lender pulls your credit...Opening multiple new accounts in a short time will reduce your average credit history which can also hurt your credit score."
Kelsey Syvrud, Ph.D. - Assistant Lecturer; Assistant Director of the BB&T Center for Free Enterprise, Florida State University

"Opening too many cards or assuming that your score is going to change overnight. Also assuming that simply downloading an app is going to change it. Ultimately, improving your credit score is driven by changing behavior. Apps or access to your score through a credit card help drive behavior because they put your score in front of you, but no change will occur without better spending patterns and careful management of outstanding debt."
Curtis M. Nicholls, Ph.D. - Associate Professor; Co-Director, Bucknell's Student Managed Investment Fund, Bucknell University





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