101 Ways to Improve Your Credit Score
You want to buy a house, a car, apply for a loan; pretty much anything these days require good credit. While some people may be in denial that the credit system should have this much influence on your life – the fact of the matter is that good credit goes a long way.
So why not improve it? Even if you have good credit, excellent credit will get you better mortgage rates on your home loan, potentially saving you thousands of dollars. Here are 101 tips to help you do just that – everything you ever wanted to know to be financially successful.
1.Pay your bills on time. Duh right? But this can significantly help your score, even if you make the minimum payment.
2.Keep your credit card balances low. Avoid owing a lot of money, makes payment time less miserable.
3.Don’t close unused credit card accounts. It lowers your credit score when they lose records on previous transactions – which happens when you close a card.
4.Avoid temptation and cut extra credit cards. It’s just too easy to charge on one more… And even easier to forget that 5th credit card bill.
5.Only keep bare minimum of credit cards available for charge. Finding a wallet big enough to contain all your credit cards is probably not the best idea in terms of controlled spending.
6.Don’t open extra credit card accounts. That 10% off your first purchase is probably not the best idea if you’re only going to use it once or twice.
7.Make sure you shop around for the best rate on a credit card. There’s no need to donate extra money towards the credit card companies.
8.Make sure you receive all the cards you applied for. You don’t want to take a chance that someone else got the one lost in the mail.
9.Keep track of where all your credit cards are.
10.Utilize free credit reports by going to annualcreditreport.com.
11.Check your credit report 3 times a year to monitor any identity theft or security issues. But be sure to stagger these reports so you can monitor it over time.
12.Opt for paperless statements for better security and to save trees.
13.Don’t buy bigger things because you can charge it, debt affects your credit score as well.
14.Don’t charge items you need months to pay off and isn’t a necessity.
15.Check around for the best interest rates on your home loan before going with that mortgage company.
16.If you’re divorced, make sure to separate your accounts after the divorce.
17.Start building your independent credit as soon as possible.
18.For those who are not in love, try to marry someone who has not declared bankruptcy – or even better, with excellent credit.
19.Meticulously examine your credit report and make sure to remove any inaccuracies.
20.Check back to make sure inaccuracies on your report has actually been removed.
21.Avoid too many inquires. Potential creditors will inquire about your credit score, too many in a short amount of time can affect it.
22.Don’t apply for too many credit cards, inquires, debt, multiple liabilities, etc all negatively impact your score.
23.Buy within your means.
24.Don’t buy that car, house, whatever that’s just out of your range.
25.Don’t put yourself in stressful debt situations.
26.Charge what you can pay off quickly.
27.Don’t skip payments; even paying the bare minimum is better.
28.Don’t default on a loan.
29.Don’t declare bankruptcy.
30.Lower your monthly payment by charging less and buying what you can afford.
31.Talk to your bank and try to waive extra fees and charges.
32.Avoid late fees. Banks charge around $40 per late payment – ouch!
33.Try and get late fees waived from your bank.
34.Avoid overdrafts.
35.Get overdraft protection.
36.Avoid signing up for extra monthly services you don’t need.
37.Evaluate all existing bills from monthly services; are you getting a lot of enjoyment from all of them?
38.Look into refinancing with a lower mortgage rate, interest rates are at a record low.
39.Talk to your creditors if you can’t make a payment ahead of time, they may allow you one freebie in return for a loan extension.
40.Don’t avoid mounting payments; procrastination often leads to more late fees.
41.Don’t close accounts with good payment history.
42.Remember while the credit reports are free, the actual score may not be. Quizzle offers your score for free without any credit card information.
43.Try not to carry a monthly balance if you don’t have to.
44.Don’t apply for more credit cards in an attempt to combat existing mounting debt.
45.Request to be an authorized user on your spouse’s accounts if they have good credit.
46.Avoid charge-off accounts, negative items such as this and bankruptcies can stay on your credit report for 7 years – ouch!
47.Take less vacations each year to pay off debt – it’s no fun, but it’ll give you a better rate on a mortgage later on.
48.Don’t exceed your credit limit. Seriously, that last purchase just isn’t worth it sometimes.
49.Look into secure credit cards to prevent overdraft fees which lower your credit score. Secure credit cards make you pay upfront, so your credit card bill “payments” are just deducted from what you’ve already paid.
50.Narrow what you buy with credit cards and find the right rewards program for that. For example, if you’re a student, get a card for what you spend the most money on – say books, and use that credit card only on books, and find a rewards program that offers more cash back on books. This way you’re not overcharging and letting debt get out of control.
51.Try not to charge over 30% of your credit limit, and never charge more than what you can pay off within a short amount of time.
52.Never use your credit cards for an impulse buy.
53.Don’t incur debt that generates interest – this makes monthly payments and budgeting far more difficult as it’s increasing the owed amount beyond what you’re spending.
54.Establish a bill paying day each month so you don’t forget any, and it’s a consistent method of preventing procrastination.
55.Build credit history – approximately 15% of your credit score comes from the length of your credit history.
56.Don’t be more than 30 days late on a credit card. If you have to be late on a card – your credit score isn’t affected until after 30 days.
57.Find a reputable credit counseling place for financial advice if you need it.
58.Be educated in your purchases and financial situation.
59.Watch out for future interest rates – many credit card companies offer 0% APR, but that goes up into an astronomical rate after the 12 months.
60.Don’t practice credit card arbitrage. This is when you borrow money from one credit card account and use it to invest in other places while paying this card off with another one that has 0% APR. While making money from your good credit may sound like a good idea – the juggling often leads to missed payments or opening too many credit card accounts which lower your score.
61.Don’t subscribe at freecreditreport.com if you don’t want to enter credit card numbers and have to cancel later.
62.Go to Quizzle if you want a free credit score (many other free credit reports charge you for the score).
63.Watch forms of “revolving credit” which lowers your credit if you have a high withstanding debt balance.
64.Don’t open accounts too rapidly and close together.
65.Checking your own credit report and score does not count as an inquiry which lowers your score.
66.Have a healthy balance of different types of loans and credit cards. Too many credit cards or too much taken out on a loan may hurt your credit score.
67.Set a goal of a credit score above 700 to encourage you to check it the 3 times a year to see if you’ve reached it.
68.Your salary does not affect your credit score, so even if your debt is relatively small compared to your income – charging over 50% of your credit limit still affects your score negatively.
69.Your age and location also does not affect your credit score, so build your credit with positive habits early.
70.For those with existing good credit scores – try using to leverage a good interest rate from your credit card company (but keep in mind they may use a different scoring system).
71.Do not cosign a loan with someone with bad credit.
72.Inquires from yourself or employers pulling reports does not affect your credit score.
73.Utilize your credit cards in a way that spreads out debt, so the amounts owed are low on each card.
74.Never close a credit card that still has a balance.
75.Don’t close your only credit card left with available credit.
76.Don’t close your only credit card.
77.Watch out for the universal default clause that allows creditors to increase your interest rate.
78.Make sure the grace period is long enough for what you need.
79.Make credit card and bill payments a few days before the due date to ensure it credits you properly and on time.
80.Don’t write bad checks. Bounced checks are tracked by banking systems and can affect your credit score.
81.If you already have bad credit, look into lenders that offer loans with flexibility, such as the FHA Express.
82.Get a co-signer with good credit to help you get that loan.
83.Try to keep a consistent employment record. Switching jobs every other month makes you look flighty to a potential lender regardless of credit scores.
84.Set an amount you can pay down your debt each month. Then make that the first payment you make when it comes time.
85.Pay down all high balanced credit cards equally – it’s ok to have remaining balances on all of them if it’s all low (this is better than 2 maxed out credit cards).
86.Make sure you know your limits on credit cards – if your limit is much lower than you thought (making your balance relatively higher), that may be attributing to your low credit score.
87.If you have old cards that never get used, use them periodically so that they are still getting as much weight in the credit scoring formula.
88.Charge small amounts with the old cards you never use, and pay it off quickly.
89.Lower your collection amounts – if you have inaccuracies on your credit report, consistently check and dispute them so you don’t have an outstanding collection amount.
90.If you miss one payment, or know you’re going to miss one, see if your lender will simply erase that from your credit history (providing that you’ve been a great borrower).
91.When reading your credit report: watch out for accounts that don’t say “current” or “paid as agreed”. Comments such as “paid charge-off” may hurt your credit, so make sure to dispute the wrongful listings.
92.If you see accounts listed as unpaid on your credit report, and you declared bankruptcy since then, make sure to correct the bureaus.
93.Credit limits on your credit report shown lower than they actually are, need to be disputed.
94.Negative items that are older than 7 years should have fallen off your report. (10 years for bankruptcy)
95.Don’t focus on misspellings of your name on credit reports (if identity theft is related then you’ll see open accounts you don’t recognize long before that).
96.Be patient. While changing your habits and budgeting hardcore is painfully clear to you, this takes awhile to show up on your credit score.
97.For beginners in building their credit – look into department store credit cards. These may be easier to get and also restrict where you can use it at, often only in that store.
98.Avoid credit repair scams. You can repair your credit through good budgeting and reasonable purchasing; don’t believe bad credit scores can be wiped away magically.
99.Don’t pay for multiple credit scores from different places. FICO score is the major one, but don’t feel like you need to pay for all of them.
100.Employers checking on your score when you apply for a job cannot affect your credit score negatively.
101.Having good credit is not rocket science. Budget well, keep track, and be educated in your finances and a good score will naturally follow. Go to Quizzle for a free credit score/report today to start managing your finances
Contact The Mortgage Mark with any questions
http://www.themortgagemark.com/
mwilkins@capitalfmc.com
