Improve Credit Scores Step-by-Step
Improve Credit Scores - Payment History Category
· Pay on time, no magic secret here
· If you can’t pay on time, notify your lender that you need to work something out
· Get current on past due accounts
Improve Credit Scores - Amounts Owed Category
· Keep low balances relative to your credit limit - 35% or lower is best.
· Don’t open new accounts just to lower your used credit capacity - having too much capacity is a risk too
Improve Credit Scores - Length of Credit Category
· Consider keeping old accounts open if you’ve been a good borrower
· Start building credit as soon as possible
Improve Credit Scores - New Credit Category
· When shopping for new credit, keep it all within a short time frame such as 14 days or less
· Borrowers with a bad history can improve credit scores by opening a new account and managing it responsibly
Improve Credit Scores - Types of Credit Category
· Installment debt (where you pay fixed monthly installments to eliminate the debt) is “better” than revolving debt (open-ended credit card debt)
· Certain finance company debts (like buying a product with retailer financing) can lower your score
In general, you need to know that it takes time and discipline to improve credit scores.