In order to raise your credit score quickly, you must be patient and responsible in using your credit card. It is a marathon rather than a sprint, so to speak. And while some would say otherwise, it can take a lot of time and patience to boost your credit score.
However, keep in mind that an excellent credit score can provide you with tons of benefits. The most important one is enabling you to qualify for lower interest loans and premium rewards credit cards. The only catch, though, is that the process can be a difficult one to go through.
But hey, you have come to the right place. If you want to raise your credit score quickly, make sure to follow these tips and keep them in mind. Good luck!
#1. Stay on Top of Your Payments
The idea is to always keep your debts in green, so your lenders will know that you are responsible with your credit. How could you trust someone who can’t keep his word, right? The same thing can be said when it comes to your credit card payments. Lenders want to be assured that you are capable of fulfilling your promises, and one of these is to stay on top of your payments. A good practice to follow every now and then is to pay your payments ahead of the due date. This should give you enough room to anticipate for any obstacles, such as sudden medical bills and emergency expenses, among many others.
#2. Make Sure To Check Your Credit Utilization Rate
This is where you are going to understand your balances relative to your current credit limit. By doing so, you will be more than capable of making sure that you are not using too much of your available credit. Keep in mind that if your ratio is higher, your chances of getting points will be lower. This means that your credit score will suffer.
By essence, credit utilization is deemed to be the most influential of all categories. It has the most impact when it comes to your credit score. Of course, your ideal rate could depend on the scoring system used. If you want to know more about the technicalities, your best course of action is to talk about this with your credit card lender.
#3. Always Pay Down Your Balance
According to reports, 30 percent of the FICO score is directly based on the amount owed. The only catch, however, is that how much you owe does is not the whole story. Rather, it is about how much you owe compared with how much credit you actually have. This ratio is known as credit utilization.
Now, this is where the importance of paying down your balance comes in. There may be cases when you will be unable to pay the right amount on time. And, as a result, your balance increases due to the accrued interest. If this is where you are right now, find a way to trim down your balance or, more importantly, pay them. If not, you are going to have a hard time boosting your credit score.
#4. Increase Your Credit Limit
Let’s say you are yet to be in a position to really pay down your balance for whatever reason you have. There is no need to worry, though – you can always take a different approach. Your best course of action is to improve your credit utilization rate and ask for an increase in your credit limit. Now, how exactly are you going to do this? Well, that is by simply calling your credit card company.
For instance, you have maxed out your $1,000 credit card. The limit, on the other hand, can be increased to $2,000 as long as you are able to straighten this out with your card provider. Once you are able to increase the limit, there is no doubt that you will be able to instantly cut your credit card utilization rate to half. However, make sure to not spend your new credit. Doing so will only defeat the purpose of trying to increase your credit limit in the first place.
#5. Negotiate Outstanding Balances
Your credit card could take a dive simply because you have a bills in debt collections. Of course, this is a sticky situation to be in, but do not lose hope. Sure, it is impossible to wipe out your past mistakes, but it does not mean you cannot make better decisions in the future. The idea is to do some damage control by negotiating your outstanding balances. Talk to your provider about what you can do to achieve this and make sure to put into writing the agreement.