Collection Proceedings In evaluating your business credit report's collection proceedings, find out whether you have a history of letting your bills lapse, or whether some of your accounts have been sent to collection. Remember that some of your late payments could come as a result of other financial issues, or a dispute with your supplier. Pay Off Your Debt, And Pay On Time If you re starting to get stuck in a rising pile of debt, especially credit card debt, you can ask a family member to pay off the high interest first, and make arrangements with your family member to pay off what you owe in a month or so. Always make it a habit to pay on time, and according to most credit experts, paying your bills on time does wonders in getting a handsome credit score. If you have debts with former creditors, make sure that you work out a full settlement with them, and guarantee that what s accomplished between you and your creditor does not get reported elsewhere. Not Having a Credit Score According to credit experts, many people today still don t have their own credit score. Late payments or any delinquencies will truly have a major effect on your credit score. If you forget to pay one or two of your bills on time, prepare to have some red marks or black eyes on your credit history. To steer clear of any delinquencies, try setting up your bills for automatic withdrawal from your personal ckeching account, so that you won't have to deal with any collection agency in the future. An incorrect report can actually deduct as much as 100 points from your credit score. Individuals with good credit scores are often called prime borrowers , and these people are more likely to get special interest rates and other rewards from creditors. However, those who have poor credit scores are often viewed by lenders as truly high-risk clients. Insurance premiums for people who've experienced bankruptcy are also more costly than for people who have stable financial records. A person who's experienced bankruptcy will also be classified as a high-risk customer, hence the rejection of his or her loan application. Before you file for bankruptcy, remember that bankruptcy is not an easy way out of your financial mess, because it will have serious implications on your credit record, and will also seriously hamper your business dealings with other people.