How to Raise Your Credit Score
It seems like everyone today is concerned with their credit score. Whether it negatively impacts your credit approval, interest rate, or job offers, your credit score and credit report can have lasting effects on your life. Because of this, it is important to do everything you can to raise your credit score as much as you can to get more beneficial results whenever someone checks your credit.
No New Ride
The most detrimental thing you can do to your credit score is to get a new car loan. The negative effects of this decision will remain on your credit report for up to six months. If it can be avoided, do not buy a new car unless you are paying cash.
Decrease Debt
One of the fastest ways to improve your credit score is to decrease your debt. The best way to do this is to use cash to bring down the total amount of debt. However, if necessary, you can use a card with a higher limit and a lower balance to take some of the load off a heavily burdened card. For instance, if you have a card that is at 75% of its limit, your goal is to bring that debt to less than half of the credit limit. If you have another card with debts totaling only 15% of the credit limit, use the second card to pay off the first one. The goal is to somehow get your debts lower than 50% of the credit limit, or 33% if at all possible. However, don’t make the mistake of getting a brand new card to use to pay off existing cards.
Stop Charging
As you work to bring down your debt and bring up your credit score, make some adjustments in your lifestyle and stop using your credit cards. In fact, leave them all at home (possibly cut up in the trash can) except for one for use in emergencies only. Use cash or a debit card for purchases so you can more easily track your expenses and you can get a handle on accruing debt. Also, call your credit card companies and request an increase in your credit limit. This is to help bring your debt to credit limit ratio down to less than 50% or 33% (see above). Do not celebrate an increase in your credit limit by using the card and further increasing the debt!
(1 votes, average: 2 out of 5)
Posted in Business & Finance, Money
