04 Aug Ways to Boost Your Credit Score Starting Now
When you meet someone, that first impression can have a lasting effect, but when it comes to lenders, your credit score is your major impression, ultimately the deciding factor between getting approved, and well, denial. No matter if you are just out of high school and are starting to build credit, have had past credit problems, or are just looking to continue to improve your score, there are a few ways that you can boost your score to not only gain approval, but to take advantage of the best rates on the market.
Never Miss a Payment Again
Payment history is one of the largest factors in your credit score, so on-time payments are key. In order to hit your credit report as a “late”, it will at least thirty days after the due date, and you will immediately start to see your credit score plunge on monthly statements showing your credit score, so on-time payments are extremely important. Not only will they negatively show up on credit, but good luck getting that hit removed from your report, which can take years to finally come off.
Pay Down Debt
Just as important to your credit score as payment history is your debt capacity. That is taking the amount of debt you carry compared to the available limit, so let’s say your limit is $5,000 but you have about maxed out that amount in charges, your score would significantly be less than would it would with a zero balance on that $5,000, showing lenders that you are responsible at charging and paying off the balance. As you continue this trend you will see your credit limit continue to increase, so it will take plenty of discipline to not go out and charge more.
Keep Accounts Open
Paying off debt is extremely important, but let’s say you have a card that has taken a couple of years to pay off and now that you are free of the balance your first instinct might be to close the account as a congrats to yourself, but closing the account would actually hurt you. By closing the account, you are removing yourself of that available credit, taking away from your overall picture, so if you have any other balances open it could actually lower your score as you would now be closer to your limit than you were before, even though you have paid off some debt.
Review Credit Report & Score Regularly
With the amount of fraudulent activity these days, you never know when your card might be skimmed at the gas station, or a large store chain that you regularly shop at was compromised and your data falls in the wrong hands, it is good to regularly check your credit report to ensure all of the information is accurate. You are entitled to a free copy of your credit report once a year from the major credit bureaus, but you can also see your score monthly on credit card statements if you see a sudden dip. Keep in mind that reports/scores are typically a month behind.