Easy Steps To Improving Your Credit Score

There are a number of things you can do to improve your FICO score

. Let's walk through them and we will also make note of how much each thing can potentially help you.

1. Settle old delinquent debts - yes, answer those pestering phone calls but before you pay ensure that you request debt validation. This puts the burden of proof on the debt collectors that they have legal rights to your debt.

You will be shocked at how often this burden of proof is not met and if that's the case then you do not have to pay the debt and it will be removed from your report once you file a dispute.

2. Pay your current bills on time - while you may have some negative items on your history it is incredibly important to keep paying your current bills on time! This is because you are creating a trail of positive payments with the bureaus.

This is also called you payment history and while negative items will hurt this significantly as the item ages it will influence your score less and less. If you are also creating a positive trail at the same time then your score will see the most improvement. This factor your payment history accounts for about 30% of your score, therefore focus your efforts here.

3. Limit your debt - I know this is easier said than done. However you should be aware that your score is influence by the amount of debt you have. This includes credit cards, student loans, auto loans, home loans all the debt you are in. The more you have the less good it will do for you.

4. Show available credit - this is tied in with step #3, it will help if you can show you have available unused credit. For instance if you have a credit card with most of the limit available and only carry a minimal balance your score will be helped. It appears that you are managing your finances and using your credit responsibly, thus you are not in dire financial straits.

This is also called your ratio of available credit to debt and will influence your score by about another 30%. Don't stress too much just try to ensure that you have unused credit.

The remaining 40% of your score is mostly factors out of your control. It is the types of credit you are using, how long you have been using it, and how often your credit is being checked. The only thing you can influence to some degree is how often your file is looked at, the more inquiries you have the worse. This is because it looks like you are trying to make purchases and use your credit anywhere and everywhere.

5. Dispute negative items on your credit report - this is without a doubt the most effective method to improve your score. You must file a dispute to get the bureaus to investigate the negative items on your reports. It could help to ensure you have paid some outstanding debts first but by disputing an item it forces the bureau to investigate it. They will contact the lender and ask them to verify it. If it can not be verified then it must be removed from your report.

Stop suffering for mistakes you have made in the past. Take advantage and enjoy the life a good credit file can offer you, it can truly change the quality of life you are living.

by: Jason Abmramsons

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