Is your credit score far from where it needs to be? If you're looking to apply for a loan, make a major purchase, rent an apartment, or even apply for a job, you know how important it is to have clean credit.
This article goes over 3 simple steps to improve your credit score.
First, you need to get your credit report and review it.
There are many free options to get your credit report or you can order it from the credit bureaus for less than $20.
Once you have your credit report, follow these 3 proven steps.
1.
Dispute Inaccurate Information This is the easiest way to improve your credit score immediately.
Look for errors in everything from your address or phone number to accounts that aren't yours.
Find all clerical errors such as incorrect address and phone numbers.
Look for accounts that show late payments, charge-offs, or in-collection status.
When you find any of these errors, write a letter to dispute them with the credit bureaus.
By law if they can't verify the information you disputed in 30 days, they must fix or remove it from your credit report.
2.
Address Recent Negative Items First The biggest factor on your credit score is your payment history.
This is a record of how you used your credit in the past.
Negative items such as past due payments, late payments, or charged-off accounts have a negative impact on your credit score.
The more recent (e.
g.
2 month ago) negative items have the more impact on your credit score than ones in the distant past (e.
g.
2 years ago).
So try to fix the most recent negative items first.
For example, you might negotiate with the creditor to remove the negative mark if you catch up on your payments, especially if you were only late once or twice.
Sometimes you can get negative items removed just by disputing them.
3.
Manage Your Credit Usage Another big factor in your credit score is your current credit usage.
If you have over-limit balances, you need to pay those down below the credit limit or request that your credit limit be increased above the current amount.
You can hurt your credit score if you are using a high percentage of your existing credit limit.
For example, if your credit limit is $10,000 and you have an $8,000 balance (80%), then your score will be lower than if you had only a $2,000 balance (20%).
Limit your credit usage to no more than 30% of the credit limit for each account at any one time.
If you follow these 3 simple steps above, your credit score may improve 100 points in just a month or two.
This article goes over 3 simple steps to improve your credit score.
First, you need to get your credit report and review it.
There are many free options to get your credit report or you can order it from the credit bureaus for less than $20.
Once you have your credit report, follow these 3 proven steps.
1.
Dispute Inaccurate Information This is the easiest way to improve your credit score immediately.
Look for errors in everything from your address or phone number to accounts that aren't yours.
Find all clerical errors such as incorrect address and phone numbers.
Look for accounts that show late payments, charge-offs, or in-collection status.
When you find any of these errors, write a letter to dispute them with the credit bureaus.
By law if they can't verify the information you disputed in 30 days, they must fix or remove it from your credit report.
2.
Address Recent Negative Items First The biggest factor on your credit score is your payment history.
This is a record of how you used your credit in the past.
Negative items such as past due payments, late payments, or charged-off accounts have a negative impact on your credit score.
The more recent (e.
g.
2 month ago) negative items have the more impact on your credit score than ones in the distant past (e.
g.
2 years ago).
So try to fix the most recent negative items first.
For example, you might negotiate with the creditor to remove the negative mark if you catch up on your payments, especially if you were only late once or twice.
Sometimes you can get negative items removed just by disputing them.
3.
Manage Your Credit Usage Another big factor in your credit score is your current credit usage.
If you have over-limit balances, you need to pay those down below the credit limit or request that your credit limit be increased above the current amount.
You can hurt your credit score if you are using a high percentage of your existing credit limit.
For example, if your credit limit is $10,000 and you have an $8,000 balance (80%), then your score will be lower than if you had only a $2,000 balance (20%).
Limit your credit usage to no more than 30% of the credit limit for each account at any one time.
If you follow these 3 simple steps above, your credit score may improve 100 points in just a month or two.
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