TIPS FOR INCREASING YOUR CREDIT SCORE

In my everyday line of work, a good credit score is often times essential for me and a client to work together. There is only one instance where some one’s credit score has no bearing on our ability to work together and that is when the client is paying cash with no financing. In the real estate industry, cash deals happen but the majority of what makes this industry, and most other industries, tick is access to capital via some form of financing. However, if the applicant for credit has a poor credit score and a history of late or non payment of bills, they will simply be denied credit and asked to come back when their score is sufficient. You can improve your credit score in no time with 5 easy steps.

1. Pay down your credit cards – Obviously, one way to improve your credit score is to pay down the debt you already have. What isn’t so obvious is which debt you should pay down first. Because normal life circumstances often leaves us with long term debt like student loans and mortgages, you shouldn’t worry about paying these down immediately. These debts are understood and weight differently in the calculation of your credit score. Credit cards on the other hand is the debt you want to pay down if not completely off as soon as possible. According to MSN Money, keeping a balance below 30% of your credit limit on each card will help your score significantly.
2. Use your old credit cards – In the calculation of your credit score, older accounts bear more weight in the calculation. They show more your payment history and your ability to manage credit. However, if you haven’t used them in a long time, they start to lose their luster in the calculation because non usage is almost as bad as having no credit at all. So, if you have any old cards that you never use, bring them back out 3-4 times a year and charge a small amount. But remember to pay that small amount down or off before the due date of your next statement.
3. Check your report for accuracy – In all the years I have lived on this Earth, there are some things that are pretty obvious to me. But, for some people, those same things don’t even register on their radar. So I’ll go ahead and say it. When it comes to your credit report, you definitely want to check your credit report to make sure it is accurate. Every individual is entitled to one free credit report a year so you have no excuse not to check it. When checking it, you want to look for any negative items like late payments, collection accounts, or items showing unpaid. One can only imagine the damage things like this can cause to your credit score. Now, imagine if these things showed up on your report and they were never supposed to be there in the first place? It happens. So when you check your latest credit report, check for inaccuracies and be prepared to dispute and ill findings.
4. Pay your bills on time – We all have bills and some have more than others. Whatever your current situation, it doesn’t matter. What matters is that every bill has a due date and it is your absolute responsibility to make sure you pay that bill on time. Depending on the bill type, they may or may not report late payments to the credit bureaus. However, if you take too long to pay the bill, they very well could not only report the late payment to the agency, but also send your past due account to a credit collective. An account in collections is just another hit on your credit score that you do not want because they will not go away until a monetary judgement is satisfied.
5. Request new credit with caution – The idea here is to balance the credit you do or do not have with your current credit situation and your current credit limits or amounts accessible. If you already have plenty of credit, then you do not want to take on more than you can manage. Remember, unused credit does not factor in highly when computing your credit score. However, if you have poor credit and are trying to rebuild your credit situation, then applying for new credit via an installment loan or revolving line is a step in the right direction. Just make sure you manage the new credit perfectly and pay your new bill on time.

One of the good things about your credit score is the fact it can always improve unless you already have what is considered ‘perfect’ credit. So, although you may have some blemishes today, tomorrow’s outlook could be improved with just a few easy steps in the right direction. Earlier in the article I mentioned everyone is entitled to a free credit report each year. To obtain your free credit report, go to www.annualcreditreport.com. Just to be clear, this is a report only and will not furnish your most up to date credit score. For a few dollars, you can obtain the report and the score almost immediately. Monitoring your credit report and maintaining your credit score is critical and will always threaten your ability to secure a loan for some of life’s biggest purchases. Don’t hurt your chances tomorrow because of steps you didn’t take the time to complete today. Your credit will follow you throughout your entire life so you might as well take as good of care of it as you can.

http://thefreshxpress.com/2010/06/fresh-finance-5-ways-to-improve-your-credit-score-now/