 Three Easy Steps to Raise Your Credit Score
Increasing your score just 5 points can save a significant
amount of money. For example, if your score is 698 and
you increase it to 703, then you could save yourself thousands
of dollars over time as a result of a slight improvement
to your loan’s
interest rate.
While credit repair is
necessary for some, it's not the only way to increase your
credit score. Even if you have stellar credit, you can
enhance your score through these steps:
- Evenly distribute your credit card debt to change the
ratio of debt to available credit. Let's say you have
a credit score of 665. If you have debt on only one card,
and four additional credit cards with zero balances,
evenly distributing the debt of the first card could
move you closer, and possibly into, that ideal bracket.
- Keep your existing accounts open and active. The average
consumer is usually anxious to close credit card accounts
that have zero balances, but doing this can cause them
to lose the benefits of a long-term credit history and
increase their ratio of debt-to-available credit. The
bottom line is don't close those old accounts!
- Keep credit inquiries to
a minimum. Each inquiry into your credit history
can impact your score anywhere from 2-50 points.
When it comes to mortgage and auto loans, even though
you're only looking for one loan, multiple lenders
may request your credit report.
To compensate for
this, the score counts multiple auto or mortgage
inquiries in any 14-day period as just one inquiry,
so try and stay within that time frame.
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