9 Ways to Raise Your Credit Score

Your credit score is one of the most valuable aspects of your finances. If your score is not good, follow the tips below to raise your credit score:

1.      Keep credit card balances low: FICO scores, the most common scoring method used by lenders, weigh 30% of your credit score on existing amounts owed on credit accounts.

2.      Avoid impulsive retail decisions: Steer away from running up your credit on random items that catch your eye. Many retailers offer small discounts when you use a credit card, but the savings won’t be worth it if your credit score is lowered.

3.      Look for errors on your report: Analyze your annual credit report, and report any discrepancies to the credit-reporting companies as soon as possible.

4.      Make timely payments: 35% of your FICO score is determined by your payment history, so it is important to not miss payment deadlines. Scheduling automatic payments before the creditor’s deadline can be helpful to ensure the payment is made.

5.      Know ALL of your credit scores: Most creditors use your FICO score to determine credit worthiness, but the three credit-reporting bureaus (TransUnion, Equifax, and Experian) created VantageScore to grade credit worthiness as well. Be aware of both of your scores.

6.      Avoid going on an application spree: new credit impacts your FICO score by 10%. If you don’t need the additional credit card, don’t apply for one.

7.      Use credit to get good credit: During the process of rebuilding your credit, it can be helpful to apply for a secured credit card, which is a card that is secured with a deposit made by the cardholder.

8.      Diversify your credit types: A good credit score depends on installment credit lines (car loans, student loans, or mortgage) and revolving credit lines (credit card or home equity line of credit). The balance of credit types accounts for 10% of your FICO score, which is significant enough to take note of.

9.      Enlist the help of a professional: Credit repair professionals can assist in cleaning up your credit and challenge questionable items presented to you by creditors and credit bureaus.

If you have any questions about improving your credit score, let us know!

518 Arbor Hill Rd.

Kernersville, NC 27284

 Ph: 336-996-3338

 www.cpamcdaniel.com

 

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