Most people think it takes a long time to raise their credit score, and usually, that’s the case. However, with some guidance and commitment, you can find out which areas of your credit need the most work and tackle them first to raise your credit score quickly.
Here are a few tips to getting your credit score pointed in the right direction.
Get Your Credit Report
Regardless of whether you have good or bad credit, it’s important to know where you stand and where you need to make improvements. Your credit report is available to you for free. Get a copy so you can first check for inaccuracies and fix those as soon as possible. Checking your credit report is one the first steps you need to take before credit repair.
Check For Inaccurate Credit Lines
Once you have gotten your credit report, pay close attention to the credit lines you have open. Check that all items on the report are ones that have been opened by you and that the information is accurate.
Check Payment Frequency
One step to getting your credit score going in a positive direction is to pay bills on time. When you get your credit report check the timelines of your payments. Make sure to dispute any recorded late payments listed if they’re inaccurate.
Watch Out for Hard Inquiries
Another ding to your credit score is the number of hard inquiries companies make on you. If there are too many inquiries made too quickly, it will negatively affect your credit score. Check the inquiries made in your report and dispute any if they’re incorrect.
Know What’s Important
The two most significant factors that make up your credit score are the debt to credit ratio (30% of your score) and payment history (35% of your score).
Payment history is just what it says: How timely are you with payments? Even if you’ve had late payments in the past, making on-time payments going forward will improve your credit score.
The credit to debt ratio is how much debt you’re carrying related to how much credit you have. Carrying lower debt on high credit accounts improves your score. So, work to pay down those high debt accounts as quickly as you can. Also, beware of carrying zero balances. Some creditors will close the account due to inactivity, which can hurt your credit score.
By monitoring and working on these critical areas, you can significantly improve your credit score quickly.
Varieties of Credit
Creditors like to see credit spread around. Having only credit card tradelines does not look as good to a creditor as having a mix of credit cards, mortgage, student loan, and automotive tradelines. Having diversity will also help improve your credit score after repairing your credit.
Beware of New Credit Lines
While it’s only 10% of your score, be careful when taking on new debt. If you open too many lines of credit too quickly, your credit score will suffer. It’s easy to fall into the trap of thinking that getting a lot of new credit cards or lines of credit quickly will improve your score — it won’t.
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