Looking to boost your credit score? Here's seven steps you can take to improve your credit score:
1. Get a copy of your credit report. There are 3 main credit bureaus and you should check each one for errors because each of the three may collect slightly different information:
- Equifax
- Experian
- TransUnion
You can request a copy of your credit report at AnnualCreditReport.com. You are entitled to one free copy of your report every 12 months.
2. Report any errors you find directly to the credit bureau. For information on how to dispute incorrect reports, the Consumer Financial Protection Bureau has good information: How Do I Dispute an Error on My Credit Report?
3. Make sure you always pay your bills on time. To make it less likely you'll forget or overlook a bill, sign up for automatic payments. For credit cards, set it up so that the minimum amount due is always paid automatically by the due date. That way you'll be covered even if you forget to make a payment.
4. Make frequent payments on your credit cards, not just once a month. Make it a habit (say every Sunday) to sit down and go over your finances. Log into your online bank account and credit card sites, and pay your cards weekly or twice a month.
5. Make a list of all of your credit cards, and itemize: total amount due, interest rate, minimum amount due, due date and the card's total limit. Which card is closest to its credit limit? Try to pay down that card first, as your credit score is affected by your total debt-to-credit ratio.
6. Ask your card company to set a higher limit, but don't use the extra charging power. This takes discipline. "Available balance" also helps to determine your creditworthiness, so use this tool to increase your credit limit and make sure you do not charge the card up to the limit. If you don't think you can resist spending up to your limit, do not take this step.
7. Do not close any credit cards. Do not open any new ones. Closing older cards hurts your credit because it decreases the average age of your accounts. Similarly, opening new ones also decreases the age of your accounts.
Posted by Ramus Realty Group on
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