While most consumers know that they have a “credit rating,” not all know their scores or how they were calculated. If your mortgage application is refused or approved for less than expected, there’s an opportunity to help you understand the causes and how to improve the score.

You may not know that your creditworthiness is assessed two ways:

Your Beacon score and a detailed history.

Credit scores range from 350 (low) to 850 (high), with 750 being the median. The numerical score is calculated on previous payment history, current indebtedness, credit history length, number and frequency of new credit inquiries and, types of credit held. Two so-called “Beacon killers,” are payments more than 30 days late (even small amounts) and maxed-out credit cards. The detailed history adds personal information, banking information and specifics on accounts and payments.

Repairing your bruised credit may not be easy, but over time it can be done. Here are three recommended strategies:

Pay all bills on time – late payments hurt ratings
Keep credit balances below 75% of the maximum
Avoid applying for additional credit; too many applications in a short period signals financial difficulties

You should also review your credit histories at least annually, which is free when requested in writing or by fax.