5 Ways To Improve Your Credit Banks Won’t Share With You
If you have a low credit score and want to improve it, certain actions will increase your credit score. First, take note of what accounts are closed – these are accounts that will be handled last. It's better to keep current accounts current and to minimize any risk that shows on your score, such as using credit cards at pawn shops. Furthermore, leave old debt that is good on your report – the longer you show good credit, the better your score.
1. Get Rid of Credit Card Balances
You want just one or two credit cards. If you have five cards with small balances of under $100, pay those off. Stop using those cards and cancel them! Keep one or two cards that you use constantly. The rating agencies are concerned with total potential exposures which drop when you cancel cards.
2. Watch Balances
Keep the percentage of used revolving credit to available credit below 30 percent. If you are able to, pay two or three small payments per month on each credit card. Keep these balances low. If you use one card for groceries and gas, try to pay most of the new charges within a week of incurring them. This will also keep your interest charges lower.
3. Catch Up on Payments
If you have accounts that are late but haven't been closed, bring them current as soon as you can. A late is better than an account that was closed for non-payment. Bringing those accounts current will increase your credit score, or nil if you have cards with a grace period through the due date.
4. Dispute Incorrect Information
If you notice that an account is late, closed for non-payment or in collections, and the account is not yours, dispute the item on your credit report. If the reporting agency insists the account is yours, require them to show you a copy of the signed application.
5. File Bankruptcy
If your credit is completely trashed, you can file bankruptcy. As soon as you complete bankruptcy, you will start getting credit offers, since your slate is wiped clean. Just be careful when choosing cards and keep all of these tips in mind when re-establishing your credit.
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