Wondering how to build your credit score fast? If yeah, you’re in the right place. Your credit score plays a significant role in your financial well-being. Unfortunately, your chances of getting loans and credit facilities at favorable terms decrease with a low credit score—that is, if you qualify for such a loan or credit facility in the first place.
You can decide to let time, up to seven years, clear your credit report of any negative information or adopt new disciplines to build it real fast. But you agree that waiting for seven years until you clear your credit report of derogatory information doesn’t make sense. Does it?
You bet it does not. Digest every bit of this article to learn how to improve your FICO score quickly.
To build your credit score fast:
- Check Your Credit Report
- Dispute Derogatory Items (If Any)
- Set a (Timed) Credit Score Goal You Want to Reach
- Pay Your Bills on Time
- Reduce Your Credit Utilization Rate
- Apply for Loans and Credit Cards Less Frequently
- Diversify Your Credit Mix
- Be an Authorized User
- Open a Secured Credit Account
- Get Your Rent and Utility Payments Reported to Credit Bureaus
Excited to learn more? Read on.
1. Check Your Credit Report
To build your credit score fast, request your credit report from any of the credit bureau by email, telephone or fax. You are eligible to request a free copy of the reports once a year. Thanks to your credit report, you can have insight into the negative items that impact your credit score negatively.
2. Dispute Derogatory Items (If Any)
To grow your credit score fast, dispute any mistake or fraudulent activities in your credit reports by requesting for correction of all irregularities or errors you notice in the reports. File for a dispute either directly to the credit bureau or to the organizations that sent the wrong data to the bureau.
Submit your dispute online through mail or fax. Visit the credit bureau’s website (Experian, for example) and click “Dispute information,” submit your request and print out the “Request for Investigation” form.
Clearly describe the item on the report you dispute, explaining why you think the information is not correct. To prove your case, attach your credit report to the dispute application form before you submit it.
Don’t forget that you can file for a dispute directly at the organization that reports any unwarranted data to the credit bureaus. To file for a dispute at all, confirm you are sure of your claims.
3. Set a (Timed) Credit Score Goal You Want to Reach
To build your credit score quite quickly, set a time-bound credit score goal you want to reach. Determine the credit score level you want to reach and the time you to reach achieve it.
Then outline the steps you need to take and how often you must follow the process until you see your credit score soar. Next, walk your talk. Follow your plans through until they deliver the results you require.
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4. Pay Your Bills on Time
To boost your credit score fast, pay your bills on time always. Believe it or not, no other strategy for increasing your credit score works faster than paying your bills on time. If you miss a payment, communicate with your creditor for more time.
Alternatively, set account reminders, or consider automatic payment to avoid missing payments in the future.
5. Reduce Your Credit Utilization Rate
To build your credit score fast, reduce the balance on your credit card by increasing the amount you can spend on your credit card. Maintain a credit utilization rate of 30% or less.
Use your card responsibly in order to ask your card issuer to increase your credit limit while you maintain your spending limit—this makes your available credit increase and your utilization rate becomes low.
6. Apply for Loans and Credit Cards Less Frequently
To help build your credit score rapidly, reduce the numbers of loans and new credit cards you apply for. Be careful not to create an impression of desperate dependence on credit facilities with several requests for loans and credit cards. Every time you apply for a new loan, the lender enquires about your credit report, which eventually affects your score.
Apply for a new credit card or loan only as the last option and as a matter of urgent necessity. If you have other option of raising funds, it is better you don’t take a loan or apply for a new credit card.
7. Diversify Your Credit Mix
To build your credit score fast, diversify your credit mix which entails considering getting other types of credit you are not currently using. Create another credit account that reduces your credit utilization rate. Consider only credit options that report to the major credit bureaus to improve your creditworthiness.
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8. Be an Authorized User
To increase the chance of improving your credit score, become an authorized user on another person’s credit card. Take the advantage of the nice payment history of the primary user of the card. Before you become an authorized user on somebody else’s credit card, discuss the risks and expectations with the primary cardholder.
9. Open a Secured Credit Account
To improve your credit score fast, strategically open a secured credit account to add positive credit history and reduce the effects of past mistakes. To open a secured credit account, present an asset—cash, most probably—that is equivalent to the credit limit you require as collateral.
When it comes to presenting your asset as collateral, understand that if you default on payment, you forfeit your base deposit
10. Get Your Rent and Utility Payments Reported to Credit Bureaus
To make a high credit score, get your rent and utility payments reported to credit bureaus. Ask your landlord to report your rent payments to the credit bureaus. Alternatively, get a rent-report service system to report your rent payments to the credit bureaus.
Conclusion
To build your credit score fast, check your credit report and dispute any derogatory item on the report. Set a time-bound credit score goal you want to reach and pay all your bills within time.
Reduce your credit utilization rate; apply for loans and credit cards less frequently. Diversify your credit mix and be an authorized card user. Open a secured credit account and let credit bureaus receive reports on your rent and utility payments.
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