It’s important to note that raising your credit score is a bit like losing weight: It takes time and there is no quick fix. In fact, quick-fix efforts usually backfire. The best advice is to manage credit responsibly over time in order to improve your credit score.
Payment History Tips
· Pay your bills on time. Delinquent payments and collections can have a major negative impact on your credit score.
· If you have missed payments, get current and stay current.
The longer you pay your bills on time, the better your credit score.
· Paying off a collection account will not remove it from your credit report. It will stay on your credit report for seven years, having less impact on the credit score as more time goes by.
· If you are having trouble making ends meet, contact your creditors or see a legitimate credit financial planner. This won’t improve your credit score, but if you can begin to manage your credit and pay on time, your credit score will get better over time.
Amount owed on credit cards tips
· Keep balances low on credit cards and other “revolving credit card accounts to 20% to 30% of your overall credit score”.
High outstanding debt does affect a credit score.
· Pay off debt rather than moving it around by opening up credit cards to pay off other credit cards. The most effective way to improve your credit score is by paying down your revolving credit. In fact, owing the same amount and having fewer open accounts may lower your score.
· Don’t close unused credit cards as a short term strategy to raise your credit score.
· Don’t open new credit cards that you don’t need, just to increase your available credit, this will actually lower the credit score.
Length of Credit History Tips
· If you have been managing credit for a short time, don’t open a lot of new accounts too rapidly.
New accounts will lower your average account age, which will have a larger effect on your score if you don’t have a lot of other credit information. Also, rapid account buildup can look risky if you are a new credit user.
New Credit Tips·
Do your rate shopping for a given loan within a focused period of time.
Credit scores can distinguish between the search for a single loan and a search for many new credit lines.
· Re-establishing your credit history after you have had problems by opening new accounts and managing them responsibly by paying them off on time will raise your credit score in the long term.
· It’s OK to request and check your own credit report.
This won’t affect your credit score, as long as you order your credit report directly from the credit reporting agency or through an organization authorized to provide credit reports to consumers.
Types of Credit Use Tips
· Apply for and open new credit accounts only as needed.
Don’t open accounts just to have a better credit mix – it probably won’t raise your score.
· Have credit cards and manage them responsibly.
In general, having 3 to 5 credit cards with installment loans will help to raise your credit score. Someone without credit cards tends to be a higher risk, thus a lower credit score, than someone who has managed credit cards responsibly.
· Closing an account doesn’t mean it will be removed from your credit report. It will have an affect on your credit score, especially if if it is an older account, and will be considered by the credit score calculation.