Best Ways To Increase Your Credit Score – Easy Tips To Improve Your Score

Best Ways To Increase Your Credit Score

Best Ways To Increase Your Credit Score

A strong credit score allows you to borrow at affordable rates now and in the future. Lenders and creditors evaluate your willingness and ability to pay based on your credit score and history with lenders. When things are not right with your credit, securing financing for major purchases becomes a challenge. Fortunately, there are specific measures that you can take to improve your credit score. Doing so will show lenders that you are financially responsible and ready for a new debt obligation. The following tips are the best ways to increase your credit score.

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Get Current

It is very important to get all your credit accounts in good standing. That involves settling any overdue amounts and getting back on track with the initial repayment schedule. Demonstrating that you can pay on time is important with new lenders, despite any past mistakes.  Once you commit to achieving good standing, your credit score will potentially improve in the coming months.

Work out the bad stuff

There is a big difference between bad debt and past due debt.  Bad debt (debt you have stopped paying) is more likely to damage your credit than the debt that is past due. For example an old credit card balance or a medical bill that has since gone into collections. It is important that you put some effort into getting it off the books, whatever the origin of the debt.

Firstly, make a list of who you owe and how much is due. This information is readily available from your credit report. Secondly, contact each creditor on the list and offer to negotiate the balance downwards. In most cases, if a debt has gone to a collection agency, the creditor may be willing to settle it.

In other instances, if you keep trying your lender may also be willing to remove late fees and interest charges. Having a plan of attack when negotiating bad debts helps you to resolve them in an affordable way. With time, this will prove to be one of the best ways to improve your credit score.

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Correct Errors

Credit reporting errors are a common feature on individual credit reports. According to a 2012 study by the FTC, one in five people had an error in their credit report. Some of these mistakes could be minor, such as a wrong address or missing employer details. However, your credit score will take a big hit if account balances, past due dates and credit limits, are inaccurate.

Correcting errors on your credit report requires some effort. You should begin by submitting a request to one of the three credit reporting agencies; Equifax, Experian, or TransUnion. It should be in writing, submitted online or mailed via a certified letter. The communication should include any information that supports the dispute. The agency has thirty days to investigate the inaccuracy. Your credit report will be corrected if confirmed.  Clearing any errors on your credit report is one of the best ways to increase your credit score.

Reduce your overall debt

Your credit score may be less than desirable because you owe a substantial amount to various creditors. One of the best ways to increase your credit score is by reducing your total debt. To positively impact your credit score, your credit utilization score should not be more than 30%. Maxed out credit card accounts or accounts close to their limits are the major cause of overutilization.

The credit utilization score is the ratio of the amount you owe to the credit lines that you have available. If your score is above this important number, make a plan to pay down your debt balances. A lower utilization percentage has the potential to increase your credit score significantly.

Be patient

Some credit mistakes may stay on your credit report and negatively affect your score for an extended period of time. For instance, a bankruptcy may remain on your credit report and impact your credit score for up to ten years. Late payments and collection accounts can stay for up to seven years. This process will require some patience on your part. Simply keep your payments up to date, lower your utilization score, correct credit report errors, and reduce your overall debt.

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Keep it simple

The need to improve your credit score can be a difficult task. However, the process does not have to be overwhelming. Focus on what you want accomplish, and start taking small steps to achieve it. This may be buying a new home, a car, or access to additional credit. Or get a small personal loan to help you establish an on-time payment history, which lenders are happy to see.

However, keep all your credit activity in check, especially by using any available credit in moderation. You should also make all your payments on time, even if it is just the minimum. Remember to maintain a close watch on your credit report, and fix any errors that may show up over time.

Taking these steps consistently and staying dedicated to the process will eventually lead to success. These are some of the best ways to improve your credit score and keep it in a healthy condition.

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4 Comments

  1. This is really needed right about now. My roommate just bailed on me, so i had to break the lease on the apartment.

    Now my credit score is all messed up. I really had no clue where to start to get it back on track, but you just cleared all that up for me.

    I know its not going to be easy but I’m definitely going to take action with these great tips you gave me.

    Great article, definitely sharing this on Facebook.

    • Hi Garrett,

      Really glad the article helped you out.  Sorry to hear about your roommate stiffing you on the rent.  That will more than likely have a negative impact on your credit score.

      The only thing you can do right now is to start working on improving your score by following the tips in the post. 

      There is more on the site if you want to dig deeper and take some quick action to increase your credit score.

      Here is a post that gives 10 easy quick tips on how to fix your credit score.

      https://creditsquared.com/how-

      Good luck and thanks for sharing on Facebook.  Tell your friends about the site.  There is more awesome content on the way.

      Creditsquared

  2. Hi, I really appreciate how you chose something that most of us struggle with on a daily basis.

    A lot of families are not coping because breadwinners are experiencing credit problems and trying to provide and put food on their families tables.

    I really appreciate all the info you provide on ways to increase your credit score. I also enjoyed reading it because it’s written in a manner that makes it easy to understand.

    I know a lot of families that can benefit from your advise. I know I did, and I’m sure the next time I apply for credit it will be a breeze.

    Thanks you.

    • Hi – Thanks for your comments on the post.

      I do understand and empathize what families are experiencing right now with there credit.  That’s why this site is here, to help those who struggle with their credit or just want to improve it.

      In order to do that, follow the tips in the post and over time if applied regularly, you should see an improvement in your credit score.  When your score improves it helps give you access to a wide variety of credit a lower interest rates.

      Patrick

      Credit Squared

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