As credit policies seem to be getting tighter and more stringent in these days of the credit crunch, one of your goals over the coming year should be to raise your credit score. Most consumers do not think about their credit score on any kind of regular basis, but doing nothing about your credit score, year after year, is probably one of the worst things you could do.

This is particularly true for mortgage loans, where it was not all that many years ago when one could get approved for a very attractive mortgage loan at almost the drop of a hat. But this is also important for other types of credit like car loans, credit cards, bank loans, and more.

The major reason it is crucial to have your credit score as high as possible is because all lenders for extending you any kind of credit will look at your credit score and credit history so they can make a decision as to how much of a credit risk you may represent to them when they consider your loan request. The interest rates and incentives they will offer is largely dependent on how much of a risk they feel you represent to them, and that risk factor is determined in large part by your credit score and credit history, as reported by the credit reporting agencies and credit bureaus.

As an example, consider a typical mortgage loan, which probably amounts to a six digit figure for the majority of mortgage holders these days. The difference of about 20 points in your credit score can make the difference between getting a rate that might be as little as a tenth of a percentage on the mortgage loan. So what you say? Over the life of the loan, those tenths of a percent can add up to more than $10,000 which is money that could be in your pocket if you had taken the time to raise your credit score before applying for the loan.

With regard to your credit score, there are some things listed on your credit report that you have zero control over, such as the amount of your income. You also have no control over the total amount of your outstanding debt, but here is where it gets dicey. The actual amount of your total outstanding debt may not be correct on your credit report.

In addition, the status of each of your financial obligations may not be accurately reflected either. Multiple studies have found that the majority of consumers have one or more errors in their credit report. These errors run the gamut of having accounts listed that do not belong to you, which is common for people with common names. It may have a debt reflected as being past due when it really is completely up to date. It may have your balance listed as $8000 when in reality your balance on that account is $80. All of these errors compound into producing a credit score for you that is lower than it should be if things were reported accurately.

Your first step in raising your credit score is to get a copy of your credit report and credit score from each of the three major credit reporting agencies. Examine them with a fine tooth comb and then start an official dispute with the credit bureau for anything that is not completely accurate. The credit bureau has an obligation, dictated by law, to either verify the information as correct, or correct it, or sometimes even remove it.

Do not become a victim of your own credit score. Take the time to raise your credit score and make it a regular part of your regular financial responsibility tasks. The money you save will serve a much better purpose in your own pockets than it will being paid out in loan payments.