We depend on our personal credit to do many things today, including buying a house, renting an apartment, or leasing a car. But what happens when our credit is shot? Poor credit could mean higher interest rates and fees as well as not getting approved for the things we want or need.
Thankfully, you can improve your credit score by as much as 100 points following these seven simple tricks.
Table of Contents
Pay your credit balances strategically by lowering your credit utilization.
Every credit card has a particular amount the issuer allocates the user at any point, and you can use this to improve your credit score. How much of the limit you use is called credit utilization, and keeping this as low as possible helps boost your credit score. According to Credit Sesame, the highest credit scorers keep their utilization at less than 7%.
Of course, 7% may sound so little to you, but you can start by aiming at making it less than 30%. The remaining fraction pays off your credit card balances, which is why limiting credit utilization is critical.
You could also try to pay your debts more than once a month and always strive to pay them off before the billing season ends. After that, the issuer submits your credit status to the credit bureaus that calculate your scores.
Apply for higher credit limits
This may sound a bit bizarre, but it works pretty fast because credit utilization influences your credit scores. This is because when the credit limit grows in size. Still, the balance remains the same. Your credit utilization definitely goes down, ultimately improving your credit scores.
So, to boost your chances of getting higher credit limits upon applying for them, pay bills in time. Then, when your wages increase, pay off debts to make your credit experience impressive.
Pay bills on time
None of the strategies to improve your credit scores will bear fruit if you have the tendency to pay bills late. Sometimes, things happen, and you cannot pay on time. If this happens, call the credit card issuer immediately to explain yourself before reporting you to the credit bureaus.
Remember, late payment reports can appear on your card for as long as seven and a half years, and every time you become delinquent, your account is hurt. If you can settle the bills before the issue forwards your details to the credit bureaus, do so because the longer you take, the worse things get.
Become an authorized user of other credit cards
You will likely find an individual or two with a positive credit history and a higher credit limit in a family with several members. Applying to Become an authorized user in such accounts helps boost your credit utilization under their high credit limits. In addition, if they are in the habit of paying it on time and have earned a positive c credit history, your card will benefit even more. What’s more, you need not use the other person’s card or have its account number to benefit from it; all you need to do is become an authorized user and add it to your account.
Optimize your status with the score-boosting programs
Did you know that other utility bill payments, as well as savings and checking data? Can you boost your credit score and improve the credit rating of a poorly performing card? Programs like UltraFICO and Experian Boost allow you to link such information to your credit profile. When these are reviewed alongside all your credit accounts and their ages, the scores improve. Credit Sesame also helps users connect several utilities to better credit ratings. So take advantage of the programs and sign up for any of these to boost your credit score really fast.
Monitor your credit profile
Monitoring your credit profile is one of the most effective secrets to improving your credit score by as far as 100 points. Checking the profile constantly helps you know any attempted identity theft on your account or any fraudulent activities that could drastically lower your scores.
Organizations like Credit Sesame now allow you to monitor your credit profile freely, see your current score and potential, and help you with practical suggestions to reach your potential score in real-time. The services get even better when you subscribe to their Advanced or Platinum account because you get access to 24/7 customer service and up-to-date information.
Add to your credit mix
This trick may seem risky, but it is an incredible hack that will significantly improve your great score if it works. For instance, if all you have is a credit card, adding a credit loan and paying it in time boosts the scores on your credit and makes your profile impressive. Besides, if you have focused on credit loans but no card, consider opening a credit account from a different line and adding to your credit mix.
What’s more, if the credit loan company reports to Experian, TransUnion, and Equifax credit bureaus, you stand a higher chance of improving your credit score.
The bottom line
Whether or not you will get it largely depends on your credit score and profile when applying for a loan. Showing that every effort to improve credit scores is worth it. Thankfully, your poor to a fair-rated credit card can improve by as much as 100 points in a short time.
In addition, a few hacks like paying your bills on time, adding to your credit mix, applying for a higher limit. Finally, lowering your utilization rate and monitoring your credit profile will significantly improve your scores.