Getting and keeping a good credit rating does take time and patience. You can’t avoid this. However, there are a few things you can do to help it improve a little faster.
One tip to remember is that accurate negative information can never be legally removed, no matter how damaging it is to your credit score.
7 Tips to Help You Quickly Boost Your Credit Score
Before you can start working on improving your credit score, you have to know what it is. You are entitled to one free report every twelve months from the three credit reporting agencies, Experian, TransUnion and Equifax. Along with your score the report will include your complete current credit history.
Now that you know what your credit score is you can start taking steps to help it improve.
- Consider the “buddy system”.
This only works with the cooperation of a close family member or spouse, and it is an effective way to quickly build up your credit history.
It entails your name being added as an authorized user on their credit account. While you won’t receive full credit for payments made on time, the little that is applied will help you create a positive credit history.
There are some downsides to using this approach that you should be aware of since they can also hurt your credit score.
- You are also accountable for any bills on the account.
- Late and missed payments will hurt your credit score.
- Can cause tension between you and the primary account holder.
For these reasons alone, most financial experts recommend only using this as a last option when you are trying to build or repair your credit.
- Report all lost, stolen and missing credit cards.
It is surprising how many consumers don’t consider this simple hack to improve their credit scores. It usually only takes a few minutes to report a credit card as missing or stolen, and in most cases it can have enormous benefits.
Most credit card issuers will simply close the account in question and open a new one. Where this can also help boost your credit score is that many banks and credit unions simply transfer the original opening date of the account to the new one. When it is reported to the credit bureaus it appears that you now have two established lines of credit. This is especially helpful since the age of the accounts comprises 15 percent of your credit score.
Not all credit issuers report lost or stolen cards the same way so it is important to ask how it will affect your score.
- When are your payments reported?
You will want to note that the payment due date and the end of the monthly billing cycle are different.
Your payments will be reported at the end of the billing cycle, even though they are typically due at the beginning or middle of the month. If your payment date is during the last week it might not be reported until the following billing cycle.
This refers to the amount of credit you’ve used versus the amount available, and applies to every card in your name.
Financial experts recommend having a ratio of 30 percent for each card. However, if you want to quickly boost your credit score try to keep your credit utilization ratio less than 10 percent.
For this to benefit your FICO score you will also have to make sure that the payments are regularly reported during each billing cycle. This means that you might have to make the monthly payments before the actual due date.
- Make a strategic payment plan.
This is actually easier than it sounds. Now that you are aware of credit utilization ratios, you know that paying off cards with higher balances will have a faster impact on your score.
Taking a few minutes to create a payment plan that allows you to quickly pay off cards with higher debt, while staying current with your other financial obligations can give a quick boost to your FICO score.
- Make payments twice a month.
Nowhere does it say that you can’t make two payments on a loan or line of credit twice a month. You do want to be careful if you are paying off the debt early. Sometimes it can come with penalties that can end up hurting instead of helping your credit, though this typically only applies to mortgages and auto loans.
If you can afford to pay off a “big ticket” item in a brief period of time, this might be the best way for you to give a low credit score a quick boost.
- Increase your credit limits.
If one of the reasons your credit score is below subpar is due to overspending, you will want to skip this step. Increasing your credit limit will only cause additional problems with your finances and score.
Raising the limits on your cards can help lower your credit utilization ratio, which is used to compile your FICO score. It is important to remember that just because you have more credit, using it will have the opposite effect on your score.
If you have made your payments on time and have a good relationship with the card issuer, asking to increase your line of credit is an easy way to see your score quickly rise a few points.
- Mix up the type of credit you use.
It’s not uncommon for consumers to get stuck using the same types of credit, typically cards and mortgages. While these regular payments will help keep your credit score above the subpar range, it won’t cause any sudden increases.
If you want to give your credit score a quick nudge consider taking out an installment loan. Whether it is a two or three year auto loan or shorter in-house financing on a new appliance, simply mixing up the type of credit reported in your history can have a positive effect.
You will want to remember that this method doesn’t apply to refinancing existing loans, only new ones.
The Final Word
These tips will help you give your failing credit score a quick boost, but they are not an instant “fix-all” for a bad score. It is always important to remember that while it only took a few months for your credit to fall below subpar ratings, it can take years to get it up to good standings.
If you want to help your credit score there are two things that you must do before using any of these tips,
- Keep credit card balances low.
- Pay all bills in full and on time.