7 Tips That Can Help You Increase Your Credit Score.

1. Dispute Errors and Inaccuracies
Recent studies show that as many as 80% of consumer credit files contain errors and inaccuracies. Chances are you might be 1 of those 80. Errors and inaccuracies, especially ones that are negatively impacting your credit scores, can lead to higher interest rates on loans and credit cards or denials for new credit. After you’ve obtained a copy of your credit reports review them carefully to identify any items that are negatively impacting your credit score and highlight everything you believe to be incorrect, inaccurate, errors or obsolete and using a credit repair software dispute those items. These could be inaccurate or outdated accounts, unauthorized inquiries, collection that are not yours, duplicate derogatory accounts and outdated or unknown public records and accounts listed as “settled,” “paid derogatory”, “paid charge-off’” or anything other than “current” or “paid as agreed” if you had in fact paid on time and in full.

2. Make Payments on Time
One of the most important things you can do to have a high credit score is to pay your payments on time. Since your payment history alone makes up the 35% of your credit score making your payments on time is critical. Late payments that are 30 days or more past due will have a negative effect on your overall credit score. Late payments stay on your credit reports for seven (7) years.

3. Make Sure All Your Credit Lines Are Posted On Your Credit Report
Often, some creditors will not post your credit line on your credit report either by a human error or due to some other mistakes. Showing less available credit will result in a lower credit score. If you notice accounts that you have are not showing up on your credit report, you can request the credit bureau to report these accounts. Also, If there are past bankruptcies that are closed and should show up with zero balance make sure to they show a zero balance! In many cases, you need to file a dispute to request that the creditor reports the “bankruptcy as a charge off as a zero balance.

4. Pay Down Debt and Don’t Max Out Your Credit Cards.
The second largest factor impacting your credit score is how much you owe. This accounts for 30% of your score. The more you owe, the lower your score will be. Someone who owes $30,000 is riskier than someone who owes only $1000, all else being equal. So a great way to increase your credit score is to pay down as much debt as you can. Another factor in the credit score formula is your debt to credit ratio which should not exceed 60% of your total available credit.

5. Keep Old Positive Accounts Open
Length of credit history is another important credit score factor, so it can be to your advantage to keep open older accounts that are in good standing. While it is important to keep the total number of open accounts manageable, it may be more hurtful to your score to close an old account than to keep it open even though it increases the number of open accounts.

6. Keep Revolving Accounts Open
It is very helpful that you maintain a variety of credit accounts. If you do not have four active credit cards, you might want to open some. If you have poor credit and are not approved for a typical credit card, you might want to set up a “secured credit card” account. A secured credit card requires you to make a deposit that is equal to or more than your limit. This guarantees the bank that you will repay the loan and is an excellent way to establish credit.

7. Use Caution When Applying for New Credit.
Every time you apply for a credit card, line of credit, or other loans, an inquiry is made to your credit report. While new credit is the least important factor in your score, it is still an important issue to consider. When you are shopping for a new loan or credit card, do your shopping in a relatively short period of time. So to avoid these inquiries, apply for new credit only if you must.

Understand What Affects Your Credit Score

FICO Credit Score Breakdown

The Exact Calculations Of The FICO Credit Score Are Kept Secret As Proprietary Information, But There Are Some General Guidelines That Can Apply