Contrary to popular belief, there are no shortcuts to raising your credit score. But there are ways to insure that you are raising it in the fastest manner possible. Read on!
1. Order your credit report from all three credit bureau's (Experian, Equifax, and TransUnion). The reason for getting all three is that sometimes, the information provided from one report to the next, is not necessarily the same.
Once you have your credit reports, go through each one carefully. You want to be sure that there are no errors dragging your credit score down. If you do find mistakes, dispute them with the credit bureau that furnished you the report, and with the creditor making the claim.
Tip: Do not dispute correct information or the credit bureau's may start to look at your claims as frivolous.
2. Pay your bills on time. This has to be the single largest factor for improving your credit. Responsibility is the core of a good credit rating.
Along with paying your bills on time, start to pay down your credit accounts. Especially those that are near their limit. Getting your credit debt down to under 30% of your total available credit could raise your score.
Tip: When you pay off an old credit card, do not close the account. Even if you don't use it any more. Older accounts establish length of credit history. The longer it is the more favorable.
3. Use your credit wisely. If you don't have an available line of credit, obtain one. Apply for an unsecured credit card or personal loan advertised to people with poor credit.
If you get a loan, make your monthly payments on time. If you get a credit card, spend only what you can afford and pay off the balance in full at the end of each month.
Tip: If you are unable to obtain unsecured credit, opt for a secured credit card. This is a slower method for building up your credit score, but well worth the effort when nothing else is available.
Remember, improving your credit is more like a marathon than a quick sprint. But by following the advice outlined above, you will be well on your way to higher credit scores and lower interest rates.