Improve Credit Score 3 Tips For Raising A Low Credit Score
Improve Credit Score – 3 Tips For Raising A Low Credit Score
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Raising your credit score does not involve a lot a work. However, there must be a willingness on your part to use credit responsibly. A low credit score makes its more challenging to obtain a credit card or get prime rates on a home or auto loan. On the other hand, a high credit score presents many finance options.
Check Credit Reports for Accuracy
Credit report errors are very common. It’s recommended that all consumers examine their reports twice yearly. This way, if …
low credit score, credit report
Raising your credit score does not involve a lot a work. However, there must be a willingness on your part to use credit responsibly. A low credit score makes its more challenging to obtain a credit card or get prime rates on a home or auto loan. On the other hand, a high credit score presents many finance options.
Check Credit Reports for Accuracy
Credit report errors are very common. It’s recommended that all consumers examine their reports twice yearly. This way, if any errors or mistakes are reported, you can quickly identify them and fix the problem.
For example, some creditors may accidentally report an account being past due or unpaid. Usually, common mistakes are easy to correct. However, if you do not start a habit of checking your report, the problems will go undetected, and can potentially lower your credit score.
It helps to obtain a copy of your report from all three bureaus. This provides an accurate credit standing. Also, it’s suggested that consumers review their credit before applying for a home loan or auto financing.
Pay Bills on Time
Never underestimate the value of making timely payments to creditors. Being habitually late on a credit card payment will greatly reduce your credit score. Moreover, this bad habit can result in raised interest rates. If possible, mail payments to creditors several days before the due date. This ensures payment reaching the creditor on time. If you have a difficult time submitting timely payments, consider setting up automatic payments.
Decrease Credit Card Balances
Credit card balances account for approximately 30% of your total FICO score. Thus, reducing balances is a quick way to significantly increase your credit score. To begin, keep credit card use to a minimum. Avoid shopping sprees and spending money frivolously. Attempt to keep balances below 25% of the credit limit.
Once you have successfully reduced or eliminated credit card balances, avoid accumulating additional debt. It may help to payoff balances each month, or establish a spending limit. It’s tempting to close paid off accounts. Although these appear to be a smart credit maneuver, closing accounts will shorten credit history, which lowers credit score.
If you own your own business you have an opportunity to really rack up the bonus points. I’ll use someone I know personally as an example. I know an electrician that owns his own business. When he gets a job he has to buy materials. The customer ultimately pays for the material as well has the labor but the gentlemen I know does have to lay out the initial funds for the materials. And we’re talking about jobs where the material costs alone may be a few thousand dollars. He’s in a fantastic situation here because he can quickly earn thousands of points toward a free trip or gas for the company truck with every job and the customer ends up paying for the materials anyway.
Tags: credit history, credit report, Credit Score, interest rate, interest rates
