Do you know you can actually boost your credit score real quick by implementing a few quick and easy hacks? If yes, there are several quick ways to do it. You don’t have to worry about a bad credit score because you can improve your credit score in a matter of weeks.
Why not read this article to the end to gain insightful knowledge on how to improve your credit score?
To Improve Your Credit Score
- Review Your Credit Report
- Identify Potential Errors
- Fix Those Errors by Filing Disputes With The Relevant Parties.
- Pay Your Bills on Time
- Use 30% or Less of Your Available Credit
- Reduce Your Request For New Credit Card
- Consolidate Your Debt
- Keep Your Old Account Open
- Monitor Your Progress
- Fatten Your Thin Credit File
Are you ready? Let’s proceed.
1. Review Your Credit Report
To improve your credit score fast, review your credit history. Extract a copy of your credit report from any of the three major national credit bureaus: Equifax, Experian and TransUnion. Review each of the results you got to know what is killing or helping your score. Also, check your credit report frequently to check for errors and services to enroll for.
Some factors can, however, help to grow your credit score, it includes, a low balance on your credit card, the use of different cards, an old credit account, a loan account and lesser request for a new credit card, and timely payment of bills.
Although a credit score does not grow overnight, fast-track the process by reducing your credit utilization percentage—the ratio of how much your owe divided by your credit limit multiplied by 100 percent. Maintain credit utilization of anything below 30%.
2. Identify Potential Errors
To improve your credit score, review your credit report for errors. Identify those errors from the information any of the three major credit bureaus (Experian, Equifax and TransUnion) provides.
Visit AnnualCreditReport.com to review your report.
Common errors, include:
- Personal information reporting errors.
- Incorrect account status.
- Appearance of incorrect information.
- Expired debt.
3. Fix Those Errors by Filing Disputes With The Relevant Parties
To boost your credit score, contact both the credit bureau and the organization that provides the information to the bureau. Get necessary personal information and documents to prove your claims.
You can file your dispute online and tell the credit bureau the errors you observe. Credit bureaus investigate errors within 30 days. Include your personal information and attach copies of your documents to support your claims.
4. Pay Your Bills on Time
To raise your credit score, pay your bills on time. Avoid paying your bills late at all costs in order to prevent negative effect on your credit history.
Proven tips include:
- Design a system that helps to monitor your monthly bills either on paper or electronically.
- Set a due date alarm to know when to pay your bills.
- Automate bills payment on your bank account.
Another option is paying off all your bills once to avoid interest rates. This option simplifies your bill payment and improves your credit score greatly.
Most lenders use five major factors to determine a lending decision:
- Credit mix
- Bill payment history
- Credit usage
- Age of credit account
- Inquiries for new credit
5. Use 30% of Your Available Credit
To boost your credit score, use no more than 30% of your credit limit. Credit utilization is simply the allotted amount of your credit limit that you spend at a given time. Pay your credit balance in full to keep your credit utilization in check.
Then ensure to keep your outstanding balance to 30% of your total credit limit.
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6. Reduce Your Request for New Credit
To grow your credit score, limit your request for new credit. Requesting new credit can lead to a drop in your credit score. Your issuer extracts information from your credit history because you applied for a credit card.
This action is termed hard inquiry and can lead to a drop in your credit score.
Avoid getting a new credit card because when you make high purchases on such cards, it increases credit utilization which in turn affects the credit score badly. Getting a new card also comes with its advantages such as raising your credit limit.
7. Consolidate Your Debt
To improve your credit score, consider taking a debt consolidation loan from the bank to pay off all outstanding debts. This means you have just one payment to make and you can be lucky to get a loan with a lower interest.
Having a lower interest rate can help you in paying your debt faster. Debt consolidation improves your credit utilization in and in turn, boosts your credit score.
Also, consider using a balance transfer credit card to pay off your debts. You can take advantage of the promotional period when the bank charges you 0% interest rate on your balance transfer credit card. But be careful of times when the balance transfer fee is 3-5% of the amount you transfer.
8. Keep Your Old Account Open
To improve your credit score, reduce how often you request for a new account. A new account reduces the average age of your account which in turn has a negative impact on your credit score.
The age of your credit account is simply how long you have opened your account. Your old account makes lenders consider you for lending. Don’t close an old account even if you are not using it. Closing it reduces your available credit and increases your credit utilization ratio
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9. Monitor Your Progress
To improve your credit score, keep track of your credit report. Credit monitoring services help to observe how your credit score changes with time. It provides a free service that monitors your credit when you open a new account or when you pay off an account.
Credit monitoring services also help to prevent the issue of fraud or theft on your account. Monitoring your credit report invariably improves your credit score.
10. Fatten Your Thin Credit File
To improve your credit score, learn to fatten your thin credit file. A thin credit file simply means not having enough credit history to get a reasonable credit score.
Ways to fatten your thin file to get a credit score include:
- Using Experian Boost: works by collating financial data that is not originally in your credit reports, such as your utility payment and banking history to calculate your Experian score.
- Using a Rent Reporting Service: when you pay your rent monthly, you get credit for the timely payment. For example, Rent Track and Rental Kharma convey your rent payment to the credit bureau—an action that invariably improves your credit score.
Recap
To improve your credit score, review your credit report, identify potential errors, and fix those errors by filing disputes with the relevant parties. pay your bills on time, use 30% or less of your available credit, reduce your request for new credit card, and consolidate your debt. Keep your old account open, monitor your progress, and fatten your thin credit file.
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