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America Scores!

March Madness has taken over Fool HQ. Now that we've filled out the bracket and placed our bets, we've moved on to a more personal competition -- comparing credit scores.

Credit reporting agency Experian randomly sampled 3 million of the 215 million credit files it tracks for a just-released study of nationwide credit usage. The bar has been set at 678, the national average credit score on a scale of 330 to 830.

New England is poised for a win, with an average credit score of 699. The "West North Central" region is seeded second with 694. The underdogs of the credit score tourney are "West South Central" folks at 657 and those charging in the Mountain region with 670. Fools in Virginia -- home of Fool HQ -- boast an impressive average credit score of 689. (We're going to the tourney, Fools!) See how your home state ranks by going to www.NationalScore.com.

For those who are glued to the monitor, the data will be updated monthly and in a year we'll be able to track year-over-year trends. But already the company reports that scores in the past several years are on the rise. Lenders have cut back their courting of subprime customers, and consumers are savvier about spotting and fixing credit conundrums.

Here's a pre-tourney checklist for those who want to go all the way:

1. Pay your bills on time. Past payment history weighs heavily (about 35%) on your credit score. One reason the West North Central region had such low scores is that those states rank the highest in late payments.

2. Don't max out. Add up all of your outstanding balances and compare the number to the amount of credit that is available to you. This measure of your credit karma makes up 30% of your credit score. Consider that the average credit score of those who use at least 50% of their available credit is 631. You want to aim to use much less than 50%.

3. Play for the long term. Fifteen percent of your credit score is determined by how long you've been using credit. Obviously, the longer your credit history, the more favorable lenders will see you.

4. Don't shop around -- too much. Each time you apply for new credit, an inquiry shows up on your report. Red flags start waving when you take on more credit -- or even just apply for new credit -- in a short period of time. This area of credit management carries a 10% weight on your overall credit score.

5. Types of credit. Types of credit include credit cards, retail accounts, and installment loans (like car loans and mortgages). Your use -- or overuse -- of these has a 10% impact on your overall score. About half the U.S. population has at least two credit cards, according to Experian data. Only 10% of those surveyed carry more than 10 cards. The national average is 3.2 credit cards per person.

For your complete credit picture, you need to see what Experian, Equifax, and TransUnion -- the three major credit reporting agencies -- have on you. Your overall credit score is based on the information reported to the bureaus. Fool followers can get a three-bureau-report plus free credit score for $29.95 by clicking this link. Go team!


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