Five Ways to Immediately Improve Your Credit Score

Let me start off with saying this, getting your credit score back into a good range is something that takes time. Now, having said that, it doesn't take a millenium! But, be prepared for a couple of up's and down's along the way while seeing your overall score increase over the course of time.

In my experience, and it is extesive, I have searched every corner of the internet, and read many more books than I care to remember or admit to, and they all say the same thing. "This process is going to take time". So be comfortable with this, and remember to setup those small wins we talked about in a post such as Payday Bloody Payday...

So here we go...

1. Get your credit balances under control. - Keeping your credit limit around 15% of the overall credit card balance, for each card, will show that you are using credit, but using it wisely. So, try and pay everything down to zero, but if you can get within that 0 - 15% range, you are doing great!

For more on this check out The Debt Snowball.

2. Do Not Close Any Open Credit Accounts. The idea of cutting up your credit cards to help with over spending is somthing that will help, just as long as you are not calling to have that account and having them close out the account. This has a two prong approach. First, the more credit you have available, not the more credit you're using, just the more credit you show on paper, the greater you credit-to-debit ratio, which is a major boost to you report. The second is, the longer your credit history, the better.

3. Never miss a payment. Even if you are just paying the minimum, you are still showing as current on your credit reports. However, if you are to miss any payments, there are five things that will hurt your score, all at different levels. They are 30-days late, 60-days late, 90-days late, 120-days late, and Closed.

As you can imagine, Closed is the worst, because of everything stated in point two, and everything from 30 - 120 is progressively worse. But what you must remember is that if you are showing anyone of these, you will also have that showing on your report for at least 7 years. That's right 7 years!!!

The good news is that the further those remarks get from the present date, the more your score will increase.  So, get on track as soon as is possible. Paying the minimums is a great place to start.

4. Payoff collections.  This is never fun, but the best idea is to get the name of the agency currently handling your debt, and send them a check with a short statement like, "As of the cashing of this check/money order, both parties consider this debt finalized". I have done this, and it worked perfectly! Plus you do not have to deal with any of these sleezy collection agents.

This information will stay on your report, and anyone telling you they can get it off in any amount of time, is flat out lying! And, most of those offers are illegal and can accutally have a negative effect on you!

Yes, you!!!

5. Secure Cards.  While this is not a final resort, it is something what will help you establish credit. Basically, it is a credit card that will require you to pay up front. The cool part is that your credit reports will reflect this card, and it will help your Debit-to-Credit ratio!

The Debt-to-Credit ratio is a bit more indept, and that is something we will go over tomorrow!!!

So tell me, did anyone find this information useful? Please feel free to leave your comments!!!

As always, thank you...The Runner