7 Simple Steps to Improving Your Credit Score

7 Simple Steps to Improving Your Credit Score

Improving your credit score is vital to any type of home ownership and improving it doesn’t just happen overnight. What happens in that most creditors only report to the bureaus once a month. To help, here are 7 simple steps to improving your credit score that you can take right now to start cleaning up your credit blemishes.

1. Be Timely: Always pay your bills on time. Late payments can have a serious impact on your score, set a reminder in your calendar/phone to remember.
2. Be Educated: Be smart and don’t apply for credit frequently.  WHY??  When you have a large number of inquiries on your credit report can worsen your score. Debtors look as if you’re just shopping around as a result of being turned down for credit.
3. Be Diligent: Set a plan to reduce your credit balances. If you are “maxed” out on your credit cards, this will affect your credit score negatively. IDEALLY you want to have no more than 40% of your available credit used up.  Ex:  A $1000 credit LIMIT, try to keep your running BALANCE below $400.
4. Be Persistent: If you’ve got any unpaid debt that you now have the capability to pay off, then either do so or try to set up a “payment plan” or settlement option with the debtor.
5. Be Resourceful: Obtain additional credit if you have limited credit. On the flip side of being “Maxed Out”, if you don’t have sufficient credit that will also negatively impact your score. Because even if you don’t like charging purchases, obtain a low-limit credit card and use it every month and pay off the balance within thirty days.
6. Be Scheduled: Your mortgage is the biggest influence on credit, so be sure to always pay it on time. Late mortgage payments are one of the most significant blemishes that you can have on your report.
7. Be Consistent: Check your credit report at least ONCE a year.  Every US Citizen can get a free copy of their credit report from each of the 3 reporting agencies ONCE a year.  Be sure to check for any mis-reported credit and even mistakes.  This can happen and you have the right to contest these so they don’t ruin any chances for home ownership.