Whether your credit score is high and you want to bump it up a few more points or you are in desperate need to improve your credit score, here are a few tips and tricks to help you…
Use credit cautiously. Yes, paying off your balance at the end of the month is a good thing, but depending on when a lender pulls your history, it is possible to still show a balance. Creditors like to see clients using credit with care so they know you won’t have any problem paying them back.
Only use a small portion of your available credit. When a credit score is ran, it will examine how much available credit you have and how much of it you are using. If the percentage you are using is too high, it will penalize you. The ideal percentage is as close to zero as you can get it. Most creditors don’t want to see anything over 25% to 35% depending on whom you ask. Anything above 50% can really start to hurt you, so keep it at 25% to be on the safe side.
Don’t carry a wallet full of cards. This might come as a surprise to you, but the people with excellent credit scores don’t use credit near as much as someone with a poor credit score. These people with excellent credit scores apply for credit about twice a year which is much less than average. You might look cool in front of your friends with a stack full of credit cards but this will not impress your lender.
Make your payments on time. Making a late payment is one of the worse ways to harm your credit score. It can drop your score as much as 100 points which will be difficult to earn back. One late payment will hurt a great credit score more than a poor one.
Think of credit as a safety net. Way too often, people are using credit cards to buy items that are not needed. When creditors pull your history, they take note to these items that have been purchased and use that to determine your “creditworthiness”. Credit should be used for major purchases such as a home or car. And credit cards should be used for expenses such as home appliances, auto repairs, or emergencies. In other words, expenses that are immediately necessary but are difficult to pay for all at once.Mail this post