| Previously I covered 2 ways to raise your credit | | | | overall credit score. The reasoning behind this is that |
| scores in part 1 of this 2 part article series on credit | | | | by closing your old accounts you actually eliminate the |
| improvement. That article focused on making sure to | | | | distance between your credit limit and the actual debt |
| pay your bills on time and why you should order a | | | | you carry. This causes the credit score calculations to |
| copy of your free credit report. This article continues | | | | lower your score a minimal amount but in the case of |
| with tips 3 through 5 on what you can do to legally and | | | | your credit, everything that raises or lowers your score |
| naturally raise your credit scores. | | | | is worth mentioning. |
| Step 3 - Pay Down Your Current Debt | | | | Step 5 - Stay Out Of Bankruptcy |
| Any debt you owe to include credit card debt is | | | | Without a doubt, filing for bankruptcy is the worst thing |
| reported to the credit bureaus once a month. It doesn't | | | | you can do to damage or completely destroy your |
| matter if the debt was carried for only a few days or | | | | credit score. It has been proven that a bankruptcy |
| from one month to the next because the credit | | | | lowers your credit score by a minimum of 200 or |
| bureaus don't differentiate between consumers that | | | | more points and they are extremely difficult to recover |
| carry a balance on their credit cards and those | | | | from because most bankruptcies stay on your |
| consumers that don't. With that said, by charging less | | | | records for up to 10 years. This has the impact of |
| debt on your credit card each month and paying it off | | | | allowing lenders to easily charge high interest rates |
| each month you can help to naturally raise your credit | | | | against you for any loan you attempt to obtain. If |
| score. Lending agencies also like to see a lot of space | | | | bankruptcy seems like an option you should make sure |
| between the amount of debt you carry on your card | | | | and seek out credit counseling first in order to try and |
| and the total credit limit. The bigger the gap, the higher | | | | salvage your financial health. |
| your credit score can climb. | | | | By following the advice and tips outlined in this article |
| Step 4 - Don't Close Old Credit Accounts | | | | and part 1 of this article series you will be able to enjoy |
| This might seem a bit contradictory to what you've | | | | better interest rates and obtain loans easier because |
| normally been told in the past but the truth is, today's | | | | your credit history and scores will show that you are |
| current credit scoring methods actually punish you | | | | not a credit risk to your prospective lenders. |
| when you close your accounts, thereby lowering your | | | | |