Five Tips to Increase Your Credit Score by joymali


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									                                  Five Tips to Increase Your Credit Score

These days, credit scores have become an important factor that they now determine the purchasing
power of an individual. Lenders and creditors review the consolidated credit history of an individual
reflected on the credit report. These are used to calculate the credit grades. It is very important to have
an outstanding grade because it will be the basis whether an individual can be approved of a loan or not.

Here are five tips that could help in improving your credit:

    1. Attain a free annual credit report and thoroughly check its inaccuracy

You can acquire a free credit report from each of the three credit bureaus—Experian, TransUnion and
Equifax. The credit reports or credit statements contain all of the past credit history. After acquiring your
credit reports, check them meticulously for any errors. If there are, report them immediately.

    2. Always make sure to pay bills on time.

If you really desire to increase your credit score, the wisest thing to do and probably the most important
is to pay your bills on time or preferably, before the due date. You can opt to set up your bank accounts
so that they provide automatic payments. This will help you pay on time. However, make sure that there
is enough money in your bank account to pay your bills. Any delinquency regarding this can reflect on
your credit report and affect your credit score negatively.

    3. Learn about the credit scores’ calculation

Your credit score depends on the following questions:

       Do you pay your bills on time? Late payments will be taken to a collection agency. Also, having a
        declared or undeclared bankruptcy will show up in your credit report.
       What is your outstanding debt? You score will be negatively affected if the amount you owe is
        close to your credit limit.
       What is the age of your credit history? A short credit history badly influences the score. But,
        there is also a need to pay close attention on timely payments and low balances.
       Have you applied for new credit recently? Too many new accounts can also bring down your
       How many and what types of credit accounts do you have? The credit-scoring models take into
        account the number and type of credit accounts an individual has. A mix of installment loans
        and credit cards can boost your credit score. But, also take note that too many bank accounts or
        credit cards can ruin the grade.

    4. Educate yourself about the legal steps you could do to improve your credit report.

Making yourself aware about the grading system will help you in enhancing your scores. You should
gather reliable and trustworthy information on how to correct errors in your report, ways on how to
deal with debt and how to avoid credit scams and frauds.

    5. Stay away from credit-repair scams.
Do not fall prey into the hands of scammers promising you quick credit fix. Managing it yourself is the
best way to repair your credit.

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