In today’s world, it’s easy to define your self worth by your FICO score. Whether you are trying to buy a house, get more credit or just get back on the right track, a low FICO score can really impact your entire life. However, there are some easy steps that you can take to increase your score and open up the possibility of lower interest rates, more approvals and an easier time of getting a mortgage.
1. Get your credit report.
You won’t know what you’re working with until you get an actual copy of your credit report. You are allowed one free each year from the three major credit bureaus. You can get it online by visiting AnnualCreditReport.com Make sure you save and print your report, since you may only be able to access it online once.
2. Find any errors and dispute them.
You’ll need to go through your entire report and make sure that all of the information is correct. If not, you can file a dispute to either have it corrected, or removed from your report. You can send in a dispute letter or you can even do it online. Results take about 45 days. You may not be successful, but it does not hurt to file a dispute.
3. Limit your new requests for credit.
Whenever you apply for new credit, an inquiry is placed on your report. Get too many in a short period of time and it will affect your score adversely. Keep all credit requests to one every three months if possible.
4. Get rid of your collections.
If you have collections on your credit report, this will hurt your overall score. You need to get them removed if possible. If they are inaccurate, dispute them. If not, you will need to send what is called a PFD letter to the creditor. This is a pay for deletion letter. Basically, you’re telling them that you will pay the debt only if they agree to remove it from your credit file.
This is vital! If you simply pay the collection, it will remain on your report, pulling down your score. It may be marked as paid, but it is still a collection and will continue to hurt your score for several years to come.
5. Pay down your high balances.
How you use your available credit has a factor on your score. If you have maxed out all of your cards, this will result in a low FICO score. Pay down those balances to free up some credit.
6. Pay your bills on time every month.
Three months of paying your cards on time can result in a jump of thirty points or more in your FICO score. This can be significant! Try to keep as current as possible and you will see a change in your score.
Rebuilding your FICO score takes time, but with these techniques, you could see a jump of 100 points or more in a few months.
Photo Credits: 1
If you liked this article, vote for it on del.icio.us and stumbleupon.Categories:
Goal, Money, Personal Finance, credit cards, credit score
Tags:
collections, credit report, credit requests, creditor, fico score, getting a mortgage, interest rates, major credit bureaus, overall score, pay for deletion letter, period of time, self worth, short period, three major credit bureaus, three months
Related Articles Related Stores
1 comment so far ↓
Too bad most people wait until they get rejected to improve their credit scores. Even if you do everything right, it still takes time. But your steps do work. You can even get legitimate bad stuff off your credit report, if you know how to do it. But that takes time too. Be patient, and your credit score can go up.
Leave a Comment