Improving My Credit Score
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There are some very simple steps you can take to improve your credit. If your credit has blemishes remember that it didn’t get that way overnight, so be patient it will take some time to correct those blemishes
Acquire credit report
Get a copy of your credit report. It is hard to know what you need to do when you have no idea what is in your report. There may be things that are not yours and there may be negative items not included. So get your report and learn how to read it.
Clean up credit report
Clean up your credit report. This sounds simple but it is important and can be time consuming. If items (trade lines) are not yours, dispute them. Make sure your personal information is correct.
Become current
Pay at least the minimum on all accounts and make your payments on time. Get accounts that are late caught up. Your payment history is 35% of your credit score. Pay minimums in such a way that the payment arrives before it is due. Paying on time every time will improve your score.
Pay off debt
Paying off your debt can increase your credit utilization score. So pay it off as fast as you can. Sell things, work overtime or take a second job. The faster you pay it off the sooner your financial stress will leave.
Make a debt plan
If you are having credit problems, facing them head on is the best thing that you can do. Call your creditors, talk to them about your financial situation. They may have ways to help. Be proactive, this is your life we are talking about. If you are feeling overwhelmed get professional help. Get an accountability partner or join a group to help you make a workable plan and stay with your plan.
No more debt
Don’t acquire any more debt. This may sound self-explanatory but if you have a credit problem stop all use of credit cards and do not acquire any more loans. Dave Ramsey says “you can not get out of debt by digging deeper. Only by climbing out.” Stopping the use of credit cards will allow the owed balance to go down increasing your available credit thereby increasing your score.
No credit applications
This goes hand in hand with no more debt. Do not apply for any credit. This includes loans or credit cards. The inquiry itself can lower your score.
Do not close accounts
Closing accounts with balances will decrease your available credit thereby affecting your credit utilization scoring. Closing old credit cards will also decrease your score in the payment history scoring. Do not close any credit account until you know how it will impact your score.
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