| Credit score is like health - most people don't think | | | | 2. Keep your credit card balances low. High |
| about it until it becomes a problem. Just as the current | | | | outstanding debt may reduce your score. If you max |
| state of your health mirrors the health habits you have | | | | out your credit cards, your score may be lowered |
| followed over a longer period of time, so your credit | | | | even by 70 points. Instead of having one card close to |
| score reflects your credit history. It means that building | | | | being maxed out, transfer the balance from this card |
| a high credit score takes time (although there are | | | | to a few other cards, so you can keep your credit |
| some shortcuts) and maintaining it is a continuous | | | | card balances at or below 25% of your credit limits. |
| process. In this article, you'll find 5 ways to increase | | | | Paying off debt is even a better way to increase |
| credit score and ensure you get good interest rates | | | | credit score, so if possible, do this, but... |
| whenever you need credit. | | | | 3. Don't close paid-off accounts! Closing old accounts |
| Before talking about the details on how to increase | | | | reduces your total available credit, which in turn |
| credit score, there are some basics you need to know. | | | | changes your utilization ratio (the amount of your total |
| Credit score, or FICO score (the most commonly used | | | | debt divided by your total available credit). This may |
| credit score, created by the Fair Isaac Corp.), is a | | | | lower your score. Shutting down your oldest credit |
| number ranging from 300 to 850 which is calculated | | | | accounts shortens your credit history, which also |
| with a mathematical model, using the information in | | | | makes you seem less credit worthy, therefore your |
| your credit report. The number shows the lender the | | | | score can drop. |
| likelihood of you paying back the loan on time. The | | | | 4. Get a small loan. In order to qualify for a bigger loan |
| higher the score, the less risky it is for the lender to | | | | (e.g. mortgage loan) in the future, you have to establish |
| give you a loan and the better interest rate you are | | | | a credit history. If you have little or no credit score, and |
| offered. If your credit score is 700 and above, you're | | | | you prefer to avoid credit cards, acquiring debt is a |
| likely to get the best interest rates available. A bad | | | | quick way to start raising your credit score. After all - if |
| credit score not only may cost you thousands of | | | | you have no debt, how can you show the potential |
| dollars in high interest rates - if your credit score is in a | | | | lenders that you are a good borrower, who pays the |
| really bad shape (e.g. below 500), you may not qualify | | | | bills on time? Of course, you have to use this method |
| for a loan at all. | | | | of building credit score wisely - excessive debt load |
| To sum up - in order to get credit and good interest | | | | and a bunch of small loans may backfire. |
| rates, you need to have a high credit score! Below you | | | | 5. Do your interest shopping within two-week periods. |
| can read 5 important tips on how to increase credit | | | | Each time you apply for a loan and the lender |
| score and keep it high. | | | | accesses your credit report, your credit score is |
| 1. Pay your bills on time. That's the first advice you'll get | | | | lowered by 3 points. When trying to find the best |
| when you're looking for ways to increase credit score. | | | | interest rate for a loan, keep your loan processes |
| This tip seems really simple and obvious, but still many | | | | within a focused period of time. This way, all your |
| people underestimate its importance. What lenders | | | | credit report inquiries are accumulated and will be |
| want to know the most is if and how timely you have | | | | treated as one single request, when your credit score |
| paid your bills in the past. That's why 35% of the credit | | | | is calculated. |
| score is based on your credit history. Delinquent | | | | These are five important things you have to consider if |
| payments and collections can severely damage your | | | | you want to increase credit score and maintain it. |
| score. The more recent your payment problems are, | | | | Although these methods are substantial in helping to |
| the worse. So, in order to increase your credit score, | | | | achieve your goal, there are lots of additional tricks to |
| start paying bills on time right now, and your score may | | | | discover... |
| already be higher after a month. | | | | |