Better credit can mean more financial options. If you’re wondering how to achieve financial freedom then here are some great tips.
1. Fix Any Late Payments
Ensure that you keep up with your payments and avoid unnecessary delinquency since that’s the only sure way to prevent a past due payment from affecting your credit score. Your overdue payments won’t disappear simply because you closed an account.
Credit reporting agencies usually don’t remove such items, but it is possible to talk a creditor into doing exactly that. Creditors may forgive one late payment particularly if you have a history on timely payments and you call to discuss it with them. Repeat delinquencies might require a bit more effort by you to get removed.
Creditors will often remove the negative mark from your credit report if you get in touch and work out something with them. You will then have to get up to date on your payments and make several on-time payments before removal of the mark, but after this happens, it can impact your credit score. You should also ensure that you pay bills on time in the future.
2. Clear Outstanding Collection Accounts
Getting in touch with creditors regarding paying off your debt is an excellent way to increase your credit score. Ensure that the creditors you contact agree to remove the negative items in your credit report if you repay it in full. Don’t forget to get it all in writing.
3. Get Added as an Authorized User
To really help raise your credit score, consider getting added as an authorized user on the account of a family member or friend with a solid credit history. While you don’t really need to use the other person’s account or credit, their good payment history and positive credit will be added to your credit reports thus making you look better financially.
4. Open a Secured Credit Card
You can easily raise your credit score by opening a secured credit card. It is a type of card that involves depositing money into a checking account to secure the credit line being extended to you by the lender. Payments come out of this account directly, which means that you cannot miss a payment and since you cannot miss a payment and you make your payments on time, your credit score will improve slowly over time.
5. Dispute Credit Inquiries
Credit inquiries are almost always hard inquiries, which means that they will impact your credit score. A hard inquiry actually remains on your credit report for 1 full year. While every individual hit is relatively minor, it can easily push you over the edge from a certain credit score tier to the one below it. Furthermore, several hard inquiries made over a relatively short period of time can drop your score significantly.
You are free to dispute credit inquiries just like any other negative factors on your credit report. You might be able to get the inquiries into your credit that you didn’t approve removed and this may easily increase your credit score, but only marginally.
6. Maintain Revolving Balances
Your credit score can suffer if you carry a large amount of debt relative to your available credit. Credit utilization actually accounts for 30 percent of your credit score. It, therefore, means that if the total available credit on your credit card is $10,000 and you are currently using just $7,000 of it, paying down the balances can improve your score. It is advisable to keep your utilization rate at about 30 percent.
7. Increase Your Credit Limits
If you are having a difficult time keeping the credit utilization rate at 30 percent, you always have the option to increase your credit limit or find another loan at Loanza. If you have a decent payment history and your credit score has improved since opening the account, the vast majority of creditors will consider increasing your maximum, which can quickly improve your credit utilization and raise the score.
Improving your credit score opens up a whole new world of purchasing power. You might no longer have to worry about being approved for that car, home, or another item you need to move one step ahead in life. Never give up on your credit. If you follow the tips provided here, you just might boost your credit score.