It might seem like years of credit repair diligence are required to undo a momentary lapse in credit judgment, but the truth is that you can accomplish a lot of healing with just a few minutes of work. Keep your credit score healthy as best you can, but right before crucial times when a credit check is required – financing a car purchase, submitting a rental application, applying for a loan – use these expert tips to give your score a little boost that could save you time, money and hassle.
1. Pay down your revolving debt. An obvious choice – lower your ratio of debt to limit and your credit score will thank you. 35% is the magic number, if you hold a larger balance then your score will suffer. Getting a sizable tax refund? Use it to knock a chunk out of your debt.
2. Use automatic bill pay. Payment history is the number one factor that impacts your credit score. If you have trouble remembering to pay on time, set up automatic bill pay through your bank or credit union. Just six months of on-time payments can bump your credit score by up to 50 points.
3. Pay credit card bills early. This one is more of an accounting trick than anything else. Pay off credit cards each month before you get your statement – to the credit card bureaus, it appears you have a $0 balance.
4. Ask for a higher limit. This is another way to lower your ratio of debt to limit… but don’t use a higher limit as an invitation to charge more!
5. No new credit cards. Store credit cards, gasoline cards, easy financing deals – every time you take on a new source of credit, your score suffers. More than two new cards a year? Too many!
Anyone can use these tips to get a little boost, but if your credit score is currently down in the dumps they can help you turn things around inside a year and lower your lending costs… every little bit helps!