Having a good to great credit score is one of the most valuable assets you can have. When you have a solid credit record, you are more likely to get lower interest rates and better terms on any loans and credit cards. This can save you a lot of money when applying for that mortgage or auto loan you are considering.
A good credit score cannot be obtained overnight. Having said that, there are a few ways in which you can fix your credit score relatively quickly. If you are not satisfied with your current credit score, we recommend you to do the following things:
Review Credit Report For Errors
Reviewing your credit report and identifying errors is probably the closest thing there is to an overnight fix.
You can request a full credit report, which is usually free of charge, from your credit bureau. Carefully read through the report and note down any errors or omissions that may negatively impact your credit score, no matter how small. Aggressively dispute these errors with copies of any supporting documents you may have. Credit bureaus will usually take less than 30 days to investigate and respond to your dispute.
Increase Credit Limit
Assuming your spending balance will remain the same, a higher credit limit will reduce your credit utilization rate. You can do this by contacting your credit card issuer and asking if you are eligible for a higher limit.
Remember to do this without a hard inquiry as they will cause your credit score to drop in the short run. Your credit issuer is more likely to grant this request if you have a punctual relationship with them or if you recently received a major boost in your income.
Make Sure Credit Cards Stay Open
Keeping your credit card accounts open is a must if you are trying to quickly improve your credit score. Closing a credit card will reduce your credit limit. As a result, your credit utilization rate will go up when calculated and negatively impact your credit score.
Furthermore, a long credit history is beneficial to your credit score and improves your chances when applying for a loan. Remember to use your credit card occasionally to prevent your issuer from closing it.
Become An Authorized User
If you know someone with a long positive credit history and high credit limit, consider asking if you can be added to their account as an authorized user. The account holder does not need to allow you to use the card or even tell you the account number.
Simply being added as an authorized user will reduce your credit utilization rate and help lengthen your credit history. As long as the account holder continues paying the credit card bill on time, you should see your credit score improve.
Pay More Than Once In A Billing Cycle
Paying your bill multiple times in a billing cycle rather than in one lump sum will help improve your credit rating.
These micro-payments can be made throughout the billing cycle and prevents your credit balance from building up towards a payment due date. This makes sure that your credit utilization rate will remain low. If you can make these payments consistently, you should see your credit score improve right away.
Bad circumstances and financial decisions can quickly ruin your credit score. Unfortunately, fixing it is not something that can be done instantly. Smart financial behavior is the only way to build up a good credit score in the long run.