Improve Your Credit Score
Improving your credit score can seem like an impossible task. This is because there is so much contradictory information and the scoring model makes you feel as though you have no direct control over your credit score.
This is incorrect. If you take a few steps you can positively influence your credit score.
1. Disputing and removing bad credit items on your report. You can do this yourself or hire a service but it will help your score the most.
2. If an item is verified then work out a way to pay them in exchange have the item removed from your your credit report.
3. Pay your bills on time. It is alleged that missing one monthly payment can cause your score to drop by up to 50 points.
4. Open a new line of credit. You will get the most benefit if this is a revolving line of credit. We recommend an unsecured credit card.
By paying your monthly bill you will develop a positive payment history. This is a heavily weighted factor when your score is being calculated. If your score is currently to low to get an unsecured credit card then open a secured card just make sure it reports to all three bureaus.
In addition try to keep your monthly balance at 10% of your available credit. Doing this shows the bureaus that you do in fact use your credit and you use it responsibly.
5. Pay your large debts down. This is called your available credit to debt. The bureaus need to see that you are not in over you head and that you do have credit that is not being used.
These are the five factors you should focus your efforts on. There is however one last factor that is surrounded by controversy.
6. Piggy back credit, this is when you are added as an authorized user on an account with a high credit limit and low balance. The benefit you get is the account is not reported on your credit history.
This tactic was widely abused and the scoring model has made some changes. It is said to have removed the benefit however it is debated as to if those changes have taken place yet.
In sum, focus on steps one through five and you are on your way to a 700 credit score. You don't have to live with bad credit you can increase your score and your quality of life.
This is incorrect. If you take a few steps you can positively influence your credit score.
1. Disputing and removing bad credit items on your report. You can do this yourself or hire a service but it will help your score the most.
2. If an item is verified then work out a way to pay them in exchange have the item removed from your your credit report.
3. Pay your bills on time. It is alleged that missing one monthly payment can cause your score to drop by up to 50 points.
4. Open a new line of credit. You will get the most benefit if this is a revolving line of credit. We recommend an unsecured credit card.
By paying your monthly bill you will develop a positive payment history. This is a heavily weighted factor when your score is being calculated. If your score is currently to low to get an unsecured credit card then open a secured card just make sure it reports to all three bureaus.
In addition try to keep your monthly balance at 10% of your available credit. Doing this shows the bureaus that you do in fact use your credit and you use it responsibly.
5. Pay your large debts down. This is called your available credit to debt. The bureaus need to see that you are not in over you head and that you do have credit that is not being used.
These are the five factors you should focus your efforts on. There is however one last factor that is surrounded by controversy.
6. Piggy back credit, this is when you are added as an authorized user on an account with a high credit limit and low balance. The benefit you get is the account is not reported on your credit history.
This tactic was widely abused and the scoring model has made some changes. It is said to have removed the benefit however it is debated as to if those changes have taken place yet.
In sum, focus on steps one through five and you are on your way to a 700 credit score. You don't have to live with bad credit you can increase your score and your quality of life.
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For more tips on how to improve credit score or to see another article about how to remove credit card judgments visit us.
posted by Credit Counseling at
12:02 PM
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