You can mitigate the effect of tighter mortgage underwriting standards by improving your credit report profile and, as a result, your credit score.

Just don't expect that your knee-jerk reaction to tighter money will generate overnight success. Chances are, you didn't get all those credit report blemishes during a single credit buying binge.

And, if you are like many consumers, you don't even know what you are up against.

BankRate.com recently found that 32 percent of Americans surveyed never check their credit reports and have no idea what shape it's in.

It's time to find out and do something about it.

Local lenders say the incidence of credit report knowledge is even higher when borrowers sit down to apply for home loans.

"Less than 10 percent have seen their report and among those who have, most of the reports are old, many are only from one bureau and so they don't have a complete picture," said Joel Spolin, president of Absolute Mortgage in Palo Alto, CA.

Your credit report is a sort of fiscal fitness report on your credit habits and the information it contains factors heavily into your credit score, a statistical analysis or numerical value placed on your credit behavior. Your credit score is commonly used to nay or yea your requests for credit and determine how much you'll pay for credit approved.

Here are seven starter steps to take toward improving your creditworthiness.

1. Get your credit report and look for errors.

These days getting a credit report should be the no-brainer first step toward improving your chances of landing credit at the best price possible.

Simply go online to AnnualCreditReport.com, the ONLY federally-sanctioned and cost-free service, and obtain a free credit report from Equifax, Experian and TransUnion. Given the year is more than half over, get your report from at least two companies, perhaps three. Next year set up your own credit monitoring service by getting a report from a different company every four months. Again, through AnnualCreditReport.com, each report is free.

Questions? Call (877) 322-8228 for details about your free credit report rights.

"We advise the client to get one report, pulled by a lender or broker and then use this report to share with other brokers so their credit is not getting constantly pulled," said Paul Garcia

A trusted lender or broker can pull your report for you and show you the ropes. Limiting the number of credit report pulls is also key. However, someone pulling your credit report can charge you a fee and the pull will show up on your credit report, though with little consequence.

Get your feet wet the first time around. Pull your own free credit report. Examine it for errors. That's the spirit of the law, to give you control and knowledge. Bring in a realty pro later, if necessary.

"It's good to get the report so the borrower knows what they are dealing with and to determine if any corrective actions need to be taken," said Garcia.

2. Check credit limits and attempt to keep balances evenly distributed across credit lines, advises attorney Edward Jamison, with the Los Angeles, CA Jamison Law Group he founded to specialize in consumer credit and identity theft.

3. Make sure your maximum credit limit is reported for each account.

"When no limit is reported, credit scoring software presumes the account is 'maxed out'." Jamison says credit scoring software scores more favorably when the balance is 50 percent or below, but too many open accounts with zero balances could lower the score with the assumption you could suddenly run up a lot of credit.

4. Keep some credit cards open. Close others.

Open credit cards with limited balances and good payment records raises scores, especially long-time credit cards. However, the accounts should be limited in number and well-managed.

"Closing credit card accounts can hurt your score unless the accounts were opened less than two years ago, and you have more six credit cards," says Jamison.

It's about striking a balance.

"Credit scoring software assumes that people who have had credit for a longer time are at less risk of defaulting on payments," Jamison said.

5. Where possible, get rid of late payments listed on the credit report.

Jamison says if your late payments are dated and you've been a good credit customers for some time creditors may, in good faith, adjust your statement.

"If you are a customer in good standing, the creditor may work with you," he said.

The effort isn't easy. A demanding, frustrated and rude approach will make it more difficult. The lender isn't required to remove dings for 7 to 10 years in some cases.

6. Pay off collection accounts and past due amounts. Payoffs and paying past due accounts start the clock running on how long the ding will remain on your report. In some cases the collection agency or creditor may remove the ding, says Jamison. Again, it's not easy.

"The consumer should contact the collector and request a letter explicitly stating their agreement to delete the account upon receipt or clearance of the payment," he said.

7. Likewise, whenever possible, seek to have charge-offs and liens that are less than two years old removed.

"Charge-offs and liens that are older than 24 months do not affect your credit score nearly as much as ones under 24 months," says Jamison.

"But if they're newer than 24 months, they can seriously damage your credit," revealing you as a more recent credit slacker.

Keep in mind, all efforts to improve your credit, other than correcting errors, are typically based on you being a mature credit consumer -- pay your bills on time, don't overload yourself with debt and get in touch with lenders at the first sign of trouble for workouts than can help save your credit or reduce the damage to your report and your credit score.

Published: July 19, 2007

Use of this article without permission is a violation of federal copyright laws.

Broderick Perkins parlayed a career in old-school journalism into a contemporary digital news service that really hits home. The award-winning consumer journalist, originally from Wilmington, DE, is founder, publisher and executive editor of the bootstrap DeadlineNews Group, a Silicon Valley-based editorial content and consulting service specializing in residential real estate, consumer news and related editorial consulting services. The DeadlineNews Group includes the website, DeadlineNews.com, offering real estate editorial content and consulting services, and its back shop, the Deadline Newsroom, an open house on news that really hits home. Perkins obtained his formal journalism education from University of Delaware and a journalism boot camp, the Institute of Journalism Education at the University of California-Berkeley. He went on to 20 years of service as a daily newspaper journalist at the Wilmington, DE News Journal and San Jose, CA Mercury News. Perkins covered housing on the San Jose Mercury News reporting team which earned a General News Reporting Pulitzer Prize in 1989 for coverage of the Loma Prieta earthquake. He has also produced real estate, consumer and small business content for the Wall Street Journal, Los Angeles Times, RealtyTimes.com, Nolo.com, Better Homes and Gardens, the National Association of Realtors, Homestore/Move and Intuit/Quicken among more than three dozen publications. In addition to managing the DeadlineNews Group, Perkins most recently served as chief editorial consultant for Nolo's Essential Guide To Buying Your First Home, Nolo, and writes real estate television scripts for RealtyTimes.com.