How Can I Raise and Keep My Credit Score High?

Your credit score can range anywhere between 300-850. The higher your credit score is the easier and faster it will be to get loan approvals, whether it’s a mortgage or car loan. The higher your credit, you may also qualify to receive better credit card offers with the lowest interest rates. There are quite a few things that contribute directly to how your credit score is calculated. Learning some good practices and truly work towards making those practices second nature can make significant change in your credit score. The following are things that you have to look for and do in order to get and maintain a high credit score:

First and foremost, you need to be consistent with your payments. Paying your bills on time is probably the single most important thing you can do right for your credit score. Many different types of companies can report late or delinquent payments to the credit bureaus not only those that apply to loans and credit cards payments. Normally a payment that is over 30 days late has GREAT potential to not only show up in your credit report but also lower your score. The more delinquent late payments you have the more negative effect it has on your score, not to mention these delinquent payments can also damage your credit score for up to 7 years.

Secondly, you need to pay attention to the amount of debt that you owe. This is the second most important thing when it comes to your credit score. This is 30% of your credit score! How this is measured, is by taking a look at all of the credit that you have available to yourself and comparing it to the how much you’ve actually used. For example, if all of your credit cards put together give you a credit limit of $5,000 and you have an overall balance between all of your cards of $1500, you’re already using 30% of your available credit. Also, your credit score is also affected by how much debt is spread out across each of your credit lines. Meaning if on one of your credit cards your credit limit is $500 and you have a balance of $400 on that card, your credit score will also be damaged because you are almost maxing out on that one card. You should to keep your cards between 0%-10% debt for each individual line for best results, paying off any amount that you use on that card off each month. You never want your debt to be over 30% of the actual limit for any one line of credit.

Don’t open unnecessary accounts either. Just as not having enough accounts open, having too many accounts open can also affect your credit score. The length of your accounts and the number of your accounts are very important. You want to keep your current accounts open for as long as possible, even if you don’t have use for them, you can still use the bare minimum on them to keep the accounts open.
You also want to review your credit report annually from all 3 credit bureaus: Experian, Equifax, and TransUnion. If there are any negative accounts reflecting in your credit report, you want to get the negative items removed as they are damaging your credit score. Negative accounts can stay in your credit report for up to 7 years, 10 if it’s a negative item for Bankruptcy. You can settle these accounts and attempt to negotiate an amount off of the amount you owe to get those items removed, taking into consideration that there are cases where even after paying off the debt the account may still continue to reflect in your credit report. However, you should also know that by law, you also have the right to dispute any information contained in your credit report that you deem to be inaccurate, incomplete, unverifiable, obsolete, or questionable.

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