How to Raise Your Credit Score Fast

Who doesn’t want to increase their credit score? It’s an important number that will decide how easily you can get a loan and qualify for low interest, reward, and cash back credit card deals.

1. Find Out When Your Issuer Reports Payment History

First thing first, call your credit card issuer and ask him when your balance gets reported to the credit bureaus. More often, that day is the closing date and or you can say the last day of the billing cycle on your account. I am sure you’ve heard of the term “credit utilization ratio.” This is the ratio of the amount of credit card that you’ve used compared to the amount of credit that is available, and it is best to keep that ratio to less than 30%. A smart way to boost your score, even quicker,  is by keeping your credit utilization ratio to less than 10%.

Let’s see how to calculate the utilization ratio:

Assume that you have two credit cards. 

The limit of Card 1 is $3,000 and a $1,500 balance.

Limit of Card 2 is $10,000 limit and a $1,000 balance on it.

Let’s calculate the utilization ratio per card:

Card 1 = 50% (1,500/3,000 = .0.5, or 50%), which is too high.

Card B = 10% (500/5,000 = .10, or 10%), which is great.

Doing this exercise will help with step number two

2. Pay Down Cards With High Balance First

Let’s talk about the utilization ratio.

In the above example, we saw there was a balance in more than one card. 

Note that Card 1 has a 50% ratio, which is high, and Card 2 has a low 10% ratio, which is quite good. To calculate the FICO score, they will check each card’s ratio so you can boost your score by paying off the card with the higher balance. 

3. Pay Twice a Month

Try to pay your balance two weeks before the closing and then make another payment just before the closing date.  I am assuming that you have the money to pay off your expenses (even the big ones) by the end of the month. Don’t pay big bills with your credit card if you plan to carry a balance as the compound interest will create a pile of debt on you pretty quickly. 

4. Ask For A Credit Limit Increase

Request a limit increase from your credit card companies, and this will lower down your credit utilization ratio percentage. A high credit limit can also grant you the positive secondary effects, such as emergency payments, and this is an efficient way to make large purchases.

So, ultimately if you have less utilization ratio, it shows that you’re doing a good job managing your money by not overspending, and keeping your spending in check can help you reach higher credit scores.

5. Do’s and don’ts 

So, if you have several unused credit cards in your wallet, do not close them as it will benefit you by showing a long credit history and a more considerable amount of available credit.

Conclusion:

In conclusion, to boost your credit score fast,  you need to follow these three basic rules:

The first thing you need to do is to keep your credit card balance as low as you can.

Secondly, pay your bills on time, and when you’re paying it, make sure you pay in full.

Thirdly keep a regular check on your credit report so that you can know what is negatively and positively affecting your credit score.

What Are The Best Way To Improve Your Credit Score?

Before knowing how to improve your credit score, let’s find out what a credit score is?

A credit score is a number ranging from 300 to 850 that represents all of your credit histories. It is calculated based on these five following components:

  • Payment history: 35%
  • Amounts owed: 30%
  • Length of credit history: 15%
  • How many types of credit in use:10%
  • Account inquiries: 10% 

To save your money a good credit score is a must thing, this three-digit number ranging from 300-850, 850 being the highest is used by lenders to decide how likely they’ll be repaid on time if they’ve granted you a loan or a credit card- this is an essential factor of your life. If you’ve got a good credit score, there are more chances of getting credit cards or loans with the most favorable terms that are ultimately going to save your money.

In this article, we’ll be talking about some of the tried and tested tricks, tips, and hacks that are surely going to boost your credit score quickly. Let’s discuss seven awesome hacks that will tell you how to fix your credit score.

To start, you need to know what your credit score is right now. But the question is, how would you know your credit score? Simple, you need to go to this article on how to get your credit score for free here. So, “what is the benefit of knowing my credit score?” well, once you are aware of your credit score, you will understand what the main factors that are affecting your credit score are. These are the risk factors that will help you to understand what changes you need to do to start improving your credit scores.

1. Pay Your Bills on Time

So, what are the things that lenders review before granting you a loan? Lenders will review your credit report, and they will undoubtedly request a credit score for you. They are keen to know how reliably you pay your bills on time, as this is probably the best way to understand past performance and helps them to predict future performance.

The final question arises on how you will improve your score, and the best way is to pay your bill on time every month. If you are paying late or settling your account balance less than what you originally agreed to pay can negatively affect your credit score. You can use external tools that will remind you to pay your credit card bill or to deposit money into your Checking account when you get paid.

2. Pay off Debt and Keep Balances Low on Credit Cards and Other Revolving Credit

Another critical number in the credit score calculation is the credit utilization ratio. The credit utilization ratio is calculated by adding all your credit card balance and dividing it by your total credit limit.

If you want to figure out the average utilization ratio of your credit card, add all the statement balances of each month and divide it by 12. What you get will be the actual credit you use each month averagely. Lenders want to see it as low as possible but play on the safe side of 30% or less.

3. Apply For New Credit Card Accounts When You Need It

A lot of people to apply for credit cards and opening new credit accounts even when they don’t need them. If you’re opening an account to have a better credit mix- this is not going to improve your credit score.

Having unnecessary credit card do harm you in multiple ways, so it is better to keep only the cards that you need.

4. Don’t Close Unused Credit Cards

Don’t close your cards if you are not using them frequently. It is a smart strategy to not closing your credit card if you are not getting charged annual fees. If you do close your card often, it will hit an increment in your credit utilization ratio.

5. Dispute Any Inaccuracies on Your Credit Reports

This last step is probably the most crucial one that people right now are frequently missing. You should regularly review credit reports from the three bureaus for inaccurate reporting. If you find any incorrect information in your credit report, you should immediately dispute the information and get it corrected as soon as possible.

The verdict!!

So, these were some of the tips that you can follow to improve your credit score quickly. Try to keep your credit card balance as low as possible, and keep on paying your bills regularly. Doing so will help you save money on your auto insurance, be able to rent better apartments, and even no need to give a security deposit with the utility companies.

How to get your Free Credit Report

In 2003 congress amended the Fair Credit Reporting Act to mandate the three credit bureaus to allow consumers to order one copy of their credit report for free annually. Now starting in 2020,you can order six credit reports per year from Equifax; this is in addition to the free report that you can request from the three credit bureau.

What is in your credit report, you may ask? Your credit report includes information about places you have lived, open or closed loans or credit card accounts, bill-paying history, any bankruptcy, and inquiries about your credit. The report is then sold to companies to help them decide your creditworthiness and your ability to repay your debts. Employers also check your credit to make a hiring decision for a job.  Reviewing your credit report annually will help you detect identity theft or inaccuracies sooner that can affect your credit.

When reviewing the report, pay attention to anything you might think is suspicious or that was reported inaccurately, such as late payments, etc.

If you find an inaccuracy, you need to report it to the credit bureaus online or by mail.  By law, they have to investigate the item in question within 30 days. You will need to provide documentation to support your claim. If the credit bureau found that the reported information on your report is inaccurate, they will report it to the other credit bureaux to be updated.

What do you do if, while reviewing your report, you noticed fraud activities such as an account opened at an address you never lived before and a slight variation in the spelling of your name or unpaid debt that you did not contract? Then you need to contact the credit bureaus, the creditors, to challenge the information. You will also file a police report and affidavit to protect yourself.

The best site to get your free credit report is  by visiting  AnnualCreditReport.com

and follow the instructions. You will need to verify your identity, and after that, you will have a chance to view the report online or to download it.

You can also select to call 877-322-8228 to request it to be mailed to you.

Lastly, you can request it by mail by first downloading the annual credit form from the FTC website here, fill it out and mail to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.

Free Credit Score

What is your credit score? This number can either help you save money or spend more money on loans or even enables you to get a job. A credit scoreis a number range from 300-850 that is calculated based on information from your credit reports reported by the three credit bureau Experian, Equifax & TransUnion. The higher the credit scores, the more attractive you are to lenders. Companies use the credit score to calculate premiums for car insurance and interest rate for loans and credit cards. The credit score is also referred to as your FICO score after the company the Fair Isaac Corporation, who created the model.

The average FICO score range is:

Excellent: 800 to 850

Very Good: 740 to 799

Good: 670 to 739

Fair: 580 to 669

Poor: 300 to 579

To get the lowest interest rate on loans, you will want your score to be above 700.

It is not too complicated to check your credit score:

If you have a major credit card or use big banks like Wells Fargo and Chase,they will allow you to check your credit score for free by logging into your account online.

Reach out to a non-profit credit counseling agency or HUD-approved housing counselors.

Lately, Experian lets you check your credit score for free by creating an account on their site.

To check your credit score from Experian click here https://usa.experian.com/registration/?offer=at_frsas102&br=exp&showDisclaimer=true&op=FRSC-ASK-