Top 10 Tips to Improve Your Credit Score

Top 10 tips to improve your credit score:

1. Pay your bills on time.

2. Pay down your debt.

3. Pay down credit cards—try to keep the balance on each to no more than 30% of your available credit—but do not close any accounts.

4. Get a credit card if you do not have one already, but you do not have to carry a balance. Simply use it on occasion and pay if off by the due date.

5. Get an installment loan. If you have a loan such as a car payment, consider taking out a personal loan and pay it off over several months. Having a mix of different types of debt is good for your score.

6. Use your older credit cards—the length of your older accounts is important so use your oldest credit cards once in awhile.

7. Check your credit report and get the following errors fixed:

a. Negative items older than seven years. These items should have come off your credit report automatically.

b. Accounts that were handled in bankruptcy but still show up as unpaid.

c. Credit limits that are incorrectly reported as lower than they actually are. This will affect your utilization rate.

d. Late payments, collections, or accounts listed as “settled”, “paid derogatory”, or “paid charge-off” if these are not accurate.

8. Ask to have late payments erased or have your accounts “re-aged” if you messed up in the past but have been on time for several months.

9. Dispute negative information that is older than three years. Small accounts may not be verified by collection companies. If they do not verify them then the reporting bureaus will drop them.

10. Avoid closing unused accounts. Cancelling old cards could make your credit utilization go up which will make your score go down even if you have negative history associated with the account.

(source credit: Inceptia)