Your credit score is a vital component of your financial health, and it can affect everything from loan interest rates to mortgage or refinancing approval. Staying on top of your credit score is incredibly important, but it can be discouraging if your score isn’t where it needs to be.
Thankfully, improving your credit score isn’t as difficult as it might initially seem. Here are 12 simple ways to start improving your credit score today:
1. Pay your bills on time.
Timely bill payment is the foundation of a good credit score. If you are delinquent on any accounts, be sure to bring the payments current as quickly as possible.
2. Keep your balances low on credit cards and revolving debt.
Consumer debt and personal loans can have a severe impact on your credit score, so it’s important to keep accounts in these categories fully paid or as low as possible.
3. Have two or three separate bank cards.
Regularly and responsibly using two or three bank cards can significantly improve your credit. That being said, department store or retail credit cards affect your score differently than bank cards and do not fall in the same category.
4. Do not open or apply for new credit cards to increase available credit.
Simply having multiple or excessive credit cards with high limits will not necessarily improve your credit.
5. Stay on top of collection agencies.
If you are paying off an outstanding balance to a collection agency, make sure they send you an official letter stating the account was “paid in full.” Furthermore, if any errors are found on your accounts, have the agency send you a letter that the account was “reported in error.” This protects you from any discrepancies that may appear on your credit report in the future.
6. Thoroughly review your credit report.
There have been many cases of errors on credit reports, many of which go unnoticed and unaddressed by all parties involved. Review your credit report in its entirety, and be sure to write dispute letters for any accounts that are inaccurate.
7. Keep your oldest accounts active.
Credit reporting agencies examine the length of your credit history when determining your credit score. Therefore, always keep your oldest accounts active provided they have never had any late payments.
You can find these credit tips and more in Advanced Credit Scoring by Dave Sullivan.
While improving your credit score doesn’t have to be complicated, it can still take time to see the results you need. Furthermore, every credit situation is unique and may require more extensive review. For more information on credit restoration and repair, call Pujol Law today to schedule your free consultation.