Improving Your Credit Score Part 2 – Tweak Your FICO by 20 Points Instantly

You can increase your FICO scores by tweaking them even if there's nothing incorrect on your report. By cleaning up a few items most people don't even think of, you can tweak your FICOs by 10-20 points. First obtain your free credit report – you are entitled to a free report from each of the three credit reporting agencies, per year (3 total per year):

  1. Free reports @ the AnnualCreditReport website (or 877-322-8228)
  2. Free FICOs @ the CreditKarma website

Once you have obtained your credit reports, you can dispute them on-line, or by mail, and request that the following items be corrected. Even though each one is only worth a few points, those points could add up and push you over that 720 FICO score limit you need to get the best interest rates:

  • Addresses – Remove any that are over 5 years old (contact credit reporting agencies to correct)
  • Names – Correct names on the report (contact your creditors to correct and report) FICO credit score, improving your credit score
  • Employers – List only the last two; remove the rest (contact contact credit reporting agencies to correct)

Next, you can start improving your credit score by following the rules described below:

  • Get 2 revolving and 3 installment accounts; use 80/20 rule. 80/20 rule: Pay down 80% of the balance, leave 20% to carry interest for 3-5 months out of the year
  • Carry no more than 30% balance of the available credit on each credit card
  • Call and ask for credit limits to be increased & get more available credit, but don't use it up. The more available credit you have, the better your FICO credit score
  • For new accounts (& mortgages), FICO credit score drops for about 90 days, then goes back up once the history is re-established
  • Ask to be added as an authorized user to someone's account with a good standing if your credit score is damaged – their good credit carries over to yours for that one credit card, which will help you greatly in improving your credit score
  • Challenge every bad piece of credit report – accurate or not. If the company that reports the derogatory credit does not respond within 30 days, the credit reporting agency is required to remove it from your credit report

Source by Angella Raisian

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