Now that you’ve obtained a copy of your credit report, it’s time to start working on increasing your credit score. Credit scores are kind of like grades in school. It doesn’t take much to let them drop, but once they do, improving them requires effort and dedication. It’s also not an issue that can be fixed magically overnight. Be prepared to be patient during the process of improving your credit score.
One of things that can lower your credit score fairly quickly is making late payments or missing them all together. There are a couple of options when it comes to remembering to pay your bills. First, keep a calendar to remind you of when your payments are due. This can either be done by scheduling them into your phone with reminders or the tried and true pen and paper method. Second, you can set up automatic payments so you don’t even need to think about it. Just remember to check your bank balance before making large purchases to make sure that you have the money.
Just because you have a credit limit of $5,000 on a card doesn’t mean you should be using all of that every month. The goal should be to use no more than 35% of your credit at any given time. Anything above this may show creditors that you rely too much on your credit, affecting your overall score.
After paying off a card, don’t cancel it. Doing so can affect the length of your credit history, which accounts for 15% of your credit score. The longer you’ve managed credit responsibly, the better your score will be. In order to receive a credit score, you must have had some form of credit for at least six months.
It seems like not a day goes by where you don’t receive some type of credit card offer. However, applying for every card available for different incentives and rewards, even if you use them responsibly, can negatively affect your credit score. Every time you apply for a new line of credit, whether it’s a credit card, loan, or mortgage, your credit score will drop a few points. You should only have as much credit that is necessary, for more on that click HERE.