8 Simple tips to help improve your credit score.
If you are struggling with a low credit score you are far better positioned for a jump in your score than someone with a strong history. The possibility of a 100 point jump in score is within reach. There is much more upside and small changes that can make a big difference.
Pay balances with a plan
As we talked about in our factors that affect your credit score blog, credit utilization is a huge portion of your credit score. Try to use less than 30% of your credit limit. Pay down the highest used card first to make the biggest change. If you can pay several times during the month to lower your balance, your score will improve.
Higher credit limits
When your limit goes up but your balance stays the same, your utilization has been lowered. Ask to increase your limit, it could be quick boost to your score.
Authorized user account
Does a family member have a long standing account with good history and a low balance? Explore becoming an authorized user, it will benefit your score. The account holder doesn’t have to allow you to use the card, but the credit boost will be beneficial.
Dispute Errors
Review your credit often, all three major bureaus provide free reports. Check for any errors and dispute anything that is not accurate. It takes some time and effort, but well worth it.
Deal with collections
Paying off collections helps to remove the threat that you could be sued over a debt, but it can also be chance to have companies stop reporting once it is paid off. Each scoring model views paid collections a little differently, but making sure to address them will be the best option.
Secured credit options
A cash deposit you pay upfront will provide you with the credit limit, be mindful of keeping a low balance when using the card. This is an avenue you can use when standard cards will not approved you as you begin to improve credit. Make sure that your institution reports to all three bureaus.
Add rent and utilities
Rent reporting services can add your on time rent payments to your credit report. Rent payments are not considered in all scoring models, however, when creditors review your report it will be there. Experian Boost can also help as the service links to your bank accounts to scan for other payments that could be used to boost your credit score.
Mix it up
An additional credit account in good standing may help your credit, particularly if it is a type of credit you do not already have.
Credit can be a challenging topic, never be shy to ask for additional information, contact any of our mortgage professionals with any credit related questions.
