A low credit score can leave you in quite the pickle. With such large purchases riding on your credit, it surely isn’t something to be taken lightly.
Lucky for you, raising your credit score doesn’t have to be as tricky as it may seem. In some cases, you don’t even have to get off the couch!
We’ve done the research for you so you don’t have to. Get ready to raise the roof on your credit score with these 7 tips.
1) Dispute Inaccuracies
You should frequently review your credit report. With a slew of free credit sites out there, there is no reason to not be aware of what’s going on.
If anything looks unusual, don’t hesitate to report it. Agencies, such as Lexington Law, specialize in disputing fallacies that affect your credit report.
2) Pay Off That Debt
It may sound a little redundant, but the best way to improve your score is making those payments.
You know, those ones. The ones hanging over your head like a little black cloud.
Missing payments and late payments are what affect your score the absolute most. It can take up to seven years for this to no longer show on your report.
That means it’s crucial to take care of this business as quickly as possible.
3) Make Payments Prior to Their Due Date
If you can avoid making payments at the last minute, this can certainly help bump you up some.
When you pay charges as they come through, you avoid having to pay a huge sum last minute. Also, this lesser balance is what is reported to the credit bureau. (Hint: They like to see low balances.)
4) Increase Ratio of Good-to-Bad Accounts
You probably weren’t expected to hear us say open a new credit card, were you?
It actually works in your favor because lenders will see a better balance of ‘good-to-bad’ accounts.
Instead of spending on the ‘bad’ account, continue to bring down its balance. However, you must be able to make adequate payments on the new account as well.
Also, opening a new card can help your utilization rates. Your report will show lower use by adding the new credit to your collective pool from other accounts.
5) Pay The Most Highly Used Cards First
When making your monthly payments, you should prioritize the cards you use most first. The ones with higher balances should take precedence over less utilized accounts.
Ideally, utilization rates are between 1% and 9%. If you are close to maxing out, set a goal to trim your rate to 50%. Then, continue working down from there.
6) Understand Not All Debt Holds the Same Weight
If you are tight on payments, make sure you prioritize secured debt over unsecured.
What is secured debt? Things like student loans, mortgages, car payments. Unsecured debt comes from credit card balances.
You should avoid missing payments at all costs. But, if it boils down to it, remember that secured items can be repossessed.
7) Ask For Help
Credit is something that will only continue to hang over your head if you let it. There’s nothing wrong with working with someone if you are really struggling with credit troubles.
There are plenty of agencies and credit counseling services that specialize in bumping credit scores. They will be able to help you determine your best course of action.
What tips do you have for bumping credit scores? Share in the comments below!