How to Increase Your Credit Score

Author: David Ray

A credit score is a numerical analysis of your credit history. It’s a popular way for lenders to determine whether they can trust you to pay back any loan you are given. The range of credit scores is 300 (low) to 850 (excellent). 

Higher scores demonstrate continuously solid credit histories, including timely payments, minimal credit use, and lengthy credit history. 

Due to missed payments or overuse of credit, debtors with lower ratings may be riskier investments.

You may do some quick, easy things to raise your credit score. Even though it can take a few months for your credit score to increase, you can start improving it right away.

Quick Tips to Boost Your Credit Score

• Payoff Revolving Account Balances

A high balance on outstanding credit accounts might result in a high credit usage rate. This may lower your scores, even if you are not in arrears on your payments. 

Revolving accounts, such as credit cards and credit lines, can raise your credit ratings if you keep the balance on them below the credit limitations. Most people with excellent credit maintain their credit use ratio under 10%.

• Verify the accuracy of your credit report.

Reviewing your credit record for any issues that could hurt your score is one strategy to raise it quickly. 

If you are successful in disputing them and getting them eliminated, your score can go up. It’s critical to evaluate credit reports because approximately 25% of Americans have issues with their credit reports. Misreported payments and duplicate or counterfeit accounts are a few common mistakes to watch out for.

• Pay your bills on time

Paying off your obligations in full and as quickly as possible is one of the best things you can do to raise your credit score. 

Avoiding late payments is crucial because your payment history heavily influences your credit score. 

If you have trouble making payments on time, you might want to set up notifications to remind you to pay or use automatic payments for your accounts.

• Keep your credit card usage modest.

Keeping your credit usage rate at or below 30% is advisable. In addition to cutting back on your spending, you can reduce your credit utilization by requesting a credit limit increase from your credit card issuer.

• Limit applying for new accounts

Hard inquiries, which might lower your credit score, are frequently the result of applications for new credit accounts. 

So, if you want to raise your score, try to cut the number of times you apply for new accounts. 

The average age of your credit record, which is another component taken into account when determining your credit rating, can also be lowered by opening a new credit line.

• Keep old accounts open.

Keep any old paid-off accounts open, even if you no longer use them. The duration of your credit record will be preserved, if you keep the accounts open.

Final Remarks

It takes time for a credit score to be repaired and a significant improvement to boost its score. Missed payments, foreclosures, repossessions, and charge-offs can be challenging. Nevertheless, the six methods in this article are an excellent way to raise your credit score and repair damaged ones.