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Boost Your Credit Score

Tips on Boosting Your Credit Score

Do you need credit history or higher credit limits? I recommend applying for the Orchard Bank Credit Card because they will take your information and offer you a credit card that best fits your credit history - Remember the more open credit lines and higher credit limits you have, the better your Credit Score will be.

If your credit needs some quick lifting, and you have a a little extra money, pay as much of your debt as possible. The lower your ratio or current debt to available credit limits the better you look to a lender, and the higher your Credit Score will be. Something else that you can do is call your credit card account holders and ask them to increase your limit, though you won't actually use it. You should do this as often as you can, even if you don't use the credit. This will also increase your credit score. Note: Do not open additional credit card accounts to increase this ratio; this may hurt you more than help you unless you have less tan 4 open credit cards. But increased credit limits on existing accounts will help since they will be lower than your overall debt ratio.

For example, if you have 10K in debt with a 15K credit limit, your ratio is 2/3 or 67%. However, if you increase your credit limit or pay down your 10K, you will lower your ratio to 50% or less, which will help your Credit Score.

Cancel some cards if you have too many, but if you are carrying debt try to keep the ratio of debt to available credit limits at around 30%, with about four cards for the best Credit Score. don't cancel cards if it will put you below this ratio, and if you have to cancel cards make sure you only cancel the ones with less than a year of payment history. Do not cancel cards that are older than one year. Please don't forget your Credit Score does not get points for being clean of old accounts. Focus on doing the things that you need to do in order to increase your score, not eliminating your report of old accounts. That may actually hurt your score instead of helping it.

Another great way of helping your score is by spreading your debt to different cards. Although you may pay more interest, your Credit Score will improve since not all your debt will be on one card that is close to its limit. For example, if you have a 30K limit on one card with 28K of debt, and you have another card with a 20K limit and only 2K in debt, it is better to move 18K of debt from the higher card to the lower card. By doing this you will lower your ratio of debt to available credit on one card helping your Credit Score without having to pay anything.

Pay your bills on time by having them automatically deducted from your bank account or paid online before they are due. Being consistently late with payments is the easiest way to lower your score, and also the easiest way to keep your Credit Score from improving month after month - just pay your credit card bills on time or early! Even if you can only swing the minimum payment, get the payment there before the due date. Most credit card companies allow you to pay online, so make sure you take advantage of this and don't waste time and money on stamps and mailings. Keep the amount of credit cards that you use to a minimum so that you don't forget to pay them.

Use your credit cards for everyday purchases, and then pay your credit cards in full monthly. Charge as much of your monthly bills as possible on your credit cards, then pay them off every month. If you happen to use a debit card, these transactions don't appear on your Credit Report. By doing this you are making another step to build your Credit History. Remember, if you are carrying a balance on any credit card. Do NOT use it for everyday purchases. For cards carrying a balance you will be charged interest the second that you make a purchase. If you are not carrying a balance, the credit card company will not charge you an interest as long as you pay it back in full every month. This is a key point to remember! Only do this if you have the self discipline needed to pay in full every month.

If you have no debt and no credit history for the past two years it is time to get some! Even though you don't need to fix your credit score, you do need to get some credit history. This may sound strange to take on debt, but it works very will since it shows you can borrow and pay back large amounts of cash. Begin responsible using a credit card for as much as possible and pay it back in full every month, or you can even leave a little bit of debt on it, (less than 30% of the limit) or take out one of those promotional low % point loans from one of your credit cards for up to 50% of your credit limit, put the cash into an account, and pay it back slowly (but before the special interest rate expires). You will notice your credit scores increasing after you have paid back the debt since you have now created good credit history. It is never too late to start building good credit history.

If you have a partner or spouse, relative, or even a friend with great credit history, have them add you to their credit card. This works very well since you will get credit for their payments of bills, and this will create more positive credit history for you. You don't even have to have them give you the credit card; as long as they charge one item onto the card in your name you will get positive Credit History from them. Again, anybody can add you to their credit card as an authorized user, and you get positive Credit History added for their good credit. The only thing to keep in mind is that the credit card issuer should ask you for your social security number before issuing the card or you will not get any benefit from them.



Equifax Credit Monitoring Service