| There are different ways to fix credit history. Time, | | | | installment payments is the single most detrimental |
| budget planning, financial discipline and perseverance | | | | factor in the credit score formula. |
| are among the most popular long term strategies that | | | | Revolving credit(major credit cards, department store |
| will help you boost your credit. However, most of us | | | | cards etc) does not have set term and fixed monthly |
| need that new house, luxury car, personal or business | | | | payment. You are given a maximum amount that you |
| loan NOW. Fixing your credit over a short period of | | | | can utilize and minimum monthly payments are |
| time is not hard, but you have to start thinking outside | | | | calculated on the bases of the current balance. |
| the box first. The more you know about the credit | | | | Revolving credit shows creditors your ability to |
| system and the loopholes in it, the better your chances | | | | manage credit wisely.Maxing out credit cards and |
| to raise your credit score FAST. Here are 3 things you | | | | keeping very high balances will damage your score |
| should keep in mind: | | | | regardless whether you pay the amount in full at the |
| 1. Credit is time sensitive. | | | | end of the month. Bringing the balance down to 20% |
| Recent payment history is given much more weight | | | | or less will have an instant positive effect on your |
| than past history when calculating your total credit | | | | FICO score. |
| score.In other words even people that have had stellar | | | | 3. Use your leverage with the collection agencies. |
| credit until recently can see their credit score plummet | | | | Collection companies do not expect to collect the full |
| drastically with a few missed payments. That's why | | | | amount that you owe. That's why they offer |
| you should focus on the most current delinquent | | | | "settlements" which are just a portion of your debt. |
| accounts. This will bring a drastic increase in your | | | | The paradox here is that paying off the settlement |
| score.On the other hand, paying off old accounts can | | | | does not get the collection off your report. It just |
| sometimes work against your interest. Thus if you pay | | | | upgrades the account to "paid" status. Now is the time |
| off an old collection, it will still remain as a negative | | | | to use your leverage with collection agencies. Offer |
| item(albeit paid), but now it will be updated and | | | | them to pay the amount in full ONLY if they remove |
| consequently will have more effect on your overall | | | | the account completely from your credit report. A |
| score. | | | | deleted collection can boost your score with more |
| 2. Revolving vs Installment credit. | | | | than 50 points. |
| Installment credit (such as auto loan, house loan, | | | | The more you know about the inner workings of the |
| student loan etc) is credit that has fixed payments | | | | credit system, the better your chances to fix credit |
| over a predetermined period of time. Paying that fixed | | | | history fast. Fast credit repair is not hard, but you have |
| amount ON TIME every month will undoubtedly | | | | to start thinking outside the box first. |
| increase your score over time. Being late on your | | | | |