Tips To Raise Your Credit Score

20150914_fm_your_credit_score

When your credit score is low it restricts  your abilities to purchase things such as cars or a home or even the ability to rent an apartment or lease a vehicle.  If you do manage to do these things while having a low credit score you will be paying a very high interest rate.

Credit scores run from 300 to 850.  The higher your score the better,.  A good credit rating will translate to lower interest rates being charged.

When attempting to raise your credit score the first thing you need to check is your credit report.  There are 3 credit reporting agencies and each may have some different information.  Check these reports and correct any errors you find.

If you have been paying your bills late – or not at all – stop this practice immediately.  It is imperative that you pay each and every bill on time with at least the minimum payment.

If for some reason you cannot make the payment talk with your creditor and see if you can work out some arrangements.

If you decide you need the services of a credit counseling service make sure you choose a reputable one.  There are many companies advertising credit counseling that are only trying to make money and will not actually help you.  If their plan sounds too good to be true it most likely is not for you.

Free_Credit_Score_Know_It.jpg_501eb4b63c253175a1f64b227d8b16b9When you are carrying balances on your credit card you can reduce these balances by not using the card and by paying the same amount each month even though the outstanding balance is lower.  That is, if you are paying $100 per month on your bill now continue paying this amount even though the minimum payment now required is only $60.  Paying only the minimum payment on your account can take 20 years to pay off a balance.

It is not good for your credit score to charge your accounts up to their limits.  Try to keep the total balances on your credit cards to below 50% of your available credit limit.  Again, lower is better.

The length of time  your accounts are open is a contributing factor to your credit score.  Be careful about closing any old accounts.  If you do close an old account be sure your credit report reflects the account was closed by the consumer.  When you do not use a credit card for a long period of time the issuer may close the account.  To avoid this problem simply charge something on the account every once in a while and then pay the charge off.

Unless you really need it do not apply for more credit. Applying for lots of credit can reflect poorly on your score.  Also, if you apply for credit and are rejected this hurts your credit score too.

Having a decent credit score is necessary for the major events in your life such as a home, car, etc.  Most people do not have the cash resources to handle major issues and need the availability of credit.  If you do not have any credit it is important to establish some and if you already have credit it is important to maintain it in good standing.