Improve Your Credit Score In Four Simple Ways

Do you maximize your free credit report that you can get once every 12 months according

to the provisions of the Fair Credit Reporting Act (FCRA)? You can use your credit report to monitor what areas need improvement especially if you constantly receive a low credit score. Credit scores are not permanent so if you are suffering previous setbacks then it is time to act on improving your credit score.

There are ways on how to improve your credit score and some of them can be done by careful scrutiny. Sometimes a low credit score is not entirely your fault. It may be caused by an error in your credit report. It pays to check your credit report so check for errors it regularly. If you find errors then dispute them so they can be corrected or deleted at the soonest possible time. According to CNN Money, 25% of credit reports contain errors and these errors are enough to have you denied of loan, favorable interests and even a job.

Old things are not always clutter. Keep old credit accounts even if you are not using them because creditors consider debt-to-credit-limit ratio and the average of how long you've had your accounts. You can also improve credit score to a significant degree of you decrease your credit balance on your credit cards to 75% or less of your available credit. More preferably, reduce your balances to 25% of your credit limit. It is always wise not to go over your credit limit because if you do, you can be sending a message to your creditors that you are an irresponsible consumer who spends way beyond your means.

Remember to pay your bills on time. Unpaid and overdue bills will set a bad record on your credit history which makes up 35% of your credit score. This is one of the most effective ways on how to improve your credit score granting that there are no big errors on your report. This is the most effective way to increase your credit score though it works on progression of a slow and steady process. You only have to develop the good habits of paying in full and on time.

Finally, be sure that you receive fewer inquiries on your credit report and do not let anyone make an inquiry if it is not absolutely necessary. The more inquiries there are on your report, the lower your score will be. If you are applying for a loan, ensure that multiple inquiries be done in a week so they will be counted as one in computing for your score. Follow these simple tips and you will improve credit score in no time.

by: Leo Chu

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