Eight Tips to Improve Credit Score
Your credit score reflects your payment patterns over time, with much emphasis on the recent information.
One common question that consumers have regarding their score includes understanding how specific actions can affect it.
Scores are totally based on the information found on a person's score.
If you find you have a low credit score and you would want to improve it for whatever purpose, below are tips to improve or increase your credit score.
1.
Make on time payments since delinquent payments and collections can negatively impacts your credit score.
Even if you have small amount owed, it is still important to make your payments promptly.
2.
Pay off debt instead of moving it around.
Do not close unused credit cards for a short-term strategy to improve your score.
Owing the same amount of debt with lesser accounts can lower your score.
3.
Avoid applying for a new credit if it is not necessary and it is important to keep your credit card balances and other revolving credit low because high outstanding credit can affect your score.
4.
Unresolved credit accounts can hurt your score.
It is necessary to settle past dues even if it is through a settlement for less than what is owed which will close the credit in question.
5.
In case you have negative information on your score like late payments, bankruptcy, foreclosure and many inquiries, you can pay your bills and wait.
Time is your greatest ally in this situation.
Remember, there is no immediate fix to a bad credit score.
6.
Check your score regularly and correct any errors made to it.
Since your score directly reflects your credit report, make sure you review your reports from all credit bureaus for accuracy several months before you apply for a loan.
If you find errors, contact them immediately through their website, on the phone, or through letter to explain the error.
Correcting your report takes at least thirty days and sometimes a lot longer.
7.
Lenders prefer a wide berth between the amount of reported debt and your total credit limit, so the more debt you pay off the wider that gap and the better your credit score.
8.
Stay out of bankruptcy as much as possible.
It is worse than missing or late payments or having your account go to a collection agent.
One simple change can actually affect many items on your credit report.
It is impossible to have an accurate assessment of how a single action can affect your credit score.
The time to rebuild your credit history after a negative one depends on the reasons that brought about the change.
Many negative changes in credit scores are due to the additional negative factors to your report like a collection account or delinquency.
These will continue to affect your score for some time.
Delinquencies will remain on your report for seven years.
Most public records will stay on for seven years, although some bankruptcies may remain until ten years and unpaid taxes for fifteen years.
One common question that consumers have regarding their score includes understanding how specific actions can affect it.
Scores are totally based on the information found on a person's score.
If you find you have a low credit score and you would want to improve it for whatever purpose, below are tips to improve or increase your credit score.
1.
Make on time payments since delinquent payments and collections can negatively impacts your credit score.
Even if you have small amount owed, it is still important to make your payments promptly.
2.
Pay off debt instead of moving it around.
Do not close unused credit cards for a short-term strategy to improve your score.
Owing the same amount of debt with lesser accounts can lower your score.
3.
Avoid applying for a new credit if it is not necessary and it is important to keep your credit card balances and other revolving credit low because high outstanding credit can affect your score.
4.
Unresolved credit accounts can hurt your score.
It is necessary to settle past dues even if it is through a settlement for less than what is owed which will close the credit in question.
5.
In case you have negative information on your score like late payments, bankruptcy, foreclosure and many inquiries, you can pay your bills and wait.
Time is your greatest ally in this situation.
Remember, there is no immediate fix to a bad credit score.
6.
Check your score regularly and correct any errors made to it.
Since your score directly reflects your credit report, make sure you review your reports from all credit bureaus for accuracy several months before you apply for a loan.
If you find errors, contact them immediately through their website, on the phone, or through letter to explain the error.
Correcting your report takes at least thirty days and sometimes a lot longer.
7.
Lenders prefer a wide berth between the amount of reported debt and your total credit limit, so the more debt you pay off the wider that gap and the better your credit score.
8.
Stay out of bankruptcy as much as possible.
It is worse than missing or late payments or having your account go to a collection agent.
One simple change can actually affect many items on your credit report.
It is impossible to have an accurate assessment of how a single action can affect your credit score.
The time to rebuild your credit history after a negative one depends on the reasons that brought about the change.
Many negative changes in credit scores are due to the additional negative factors to your report like a collection account or delinquency.
These will continue to affect your score for some time.
Delinquencies will remain on your report for seven years.
Most public records will stay on for seven years, although some bankruptcies may remain until ten years and unpaid taxes for fifteen years.
