Developing good credit habits and building a favorable credit history should be a part of everyone's personal financial plan. One tiny blemish on your credit report won't knock you out of the running for a home mortgage, but a series of black marks can prevent you from obtaining just about any type of credit on favorable terms. Here are four simple rules to follow by:

1. Limit your own supply of credit.
2. Use a few credit cards steadily and consistently.
3. Watch out for minimum payment traps.
4. Pay your bills on time.

Do not max. out your credit card balances on your credit cards. After you pay off your credit card balances do not close the credit cards associated. When you close the credit cards this shortens your credit history. By leaving them open you are able to establish a longer credit history and therefore increase your credit score.

Federal Legislation has required that each of the three (3) major credit agencies make your credit report available to you once per year. Simply check your credit report for errors, omissions, etc. by logging onto www.annualcreditreport.com and have access to your report from Equifax, Experian, and Trans Union. From there you can dispute innaccuracies and potentially get them removed, best of all it is overseen by the government and it's FREE!

A good credit score can be achieved by practicing prudent financial responsibility. Having good credit often qualifies you for better rates and more aggressive (LTV) loans.

Avoid offers such as "90 days same as cash", "no payments for one year", etc. Signing up for these kind of offers result in installment type credit accounts on your credit report. Having consumer installment type accounts can result in lowering your credit score.

Keep your credit card balances at 50% of the limit or lower. This will greatly affect your crdit score in a positive way. This will also make it easier to pay off if need be.

Honor your agreements with vendors. Do not stop making installment payments because you are dissatisfied with an appliance you bought. Instead, try to resolve the issue with the vendor, even if it means going to court. Vendors who grant you credit on purchases can report to the credit agencies. Another common mistake people make is they stop honoring sales agreements they make with mobile phone companies. Many mobile phone carriers give away phones for free with a 1 or 2 year contract. People who break their contracts will be reported to credit bureaus.

If your credit score is lower than you expected, ask us about what steps you can take to improve your credit score to qualify for the loan programs you require. A debt consolidation loan can help pay off many of the debtssuch as credit card debt and monthly installments which are dragging your credit down, and regular payment of your new lower monthly mortgage payment will help raise your scores as well.

Once you make the decision to obtain a mortgage, refrain from seeking other types of credit, whether it be a car loan or a credit card. These inquiries can lower your credit score and increase your mortgage costs.

Online banking, online bill paying, direct deposit and automatic withdrawals.

Technology is a great habit to get into with your finances. If you can direct deposit to multiple accounts start putting your savings away before you even see it. If you can pay your bills with an automatic withdraw start to set it up, and stop trying to make time to pick up stamps, stop by the post office and drop off your mail.

Don't schedule one time of the month, or week to pay your bills and balance your check book, etc. Pay your bills as soon as you get them.

Credit inquiries can also have an affect on your score. Refrain from applying for too many credit cards, gas cards, or department store cards because too many inquiries can lower your score.