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Improve credit score fast - how to boost your credit scores

Mon Sep 22, 2008 02:09PM | By Tony

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Assuming that your report don't show some nasty credit problems like unpaid tax lien, bankruptcy, foreclosure, recent late payments, unpaid charge-offs or collections over $400, you should be able to improve credit score fast. Do a quick mental check if you may have any of those. If your middle score is somewhere below 620, you are in a good company of close to 31 million Americans. Obviously, the better your credit, the lower the interest rates you can secure on mortgages, car loans and credit cards so boosting your credit is rather beneficial to put it mildly. Even your habit of paying medical bills on time on not, is rumored to be incorporated into MedFICO credit scoring system.

If I would consider how to improve my credit score, the first step to take is to get the latest credit reports. I am talking about reports with scores closest to the ones lender will get when and if you decide to apply for a loan. Our credit monitoring comparison is a quick way to start. Once you get them, review for accuracy, making sure you can identify each and every record.

Look at your credit records and identify all revolving accounts. These are credit cards, department store/gas station cards and home equity lines of credit. While it is almost irrelevant with installment loans, e.g. auto, home or student loan, you definitely want to carry revolving balances under 35% of a credit limit on each account, especially if your credit history is less than 2 years or the credit card is less than 3 months old. Basically the lower the ratio is better for your credit scores. So first pay off your credit cards that are closest to their limits.

Other ways to improve your credit score quick is to ask creditor to increase credit limit for revolving line with too high of a balance or open an additional credit card or two and keep them at zero balance or at the very minimum. In rare cases, I have seen lenders mistakenly showing a lower than actual limit. If it is the case, call your credit card issuer for a fix.

If you keep an old card, then use it occasionally. The old or seasoned credit records carry more weight for the credit scoring formula, but the issuers need to keep updating those seasoned accounts at the credit agencies. Otherwise, while the accounts still appear as ACTIVE, they are not counted as such. Use established revolving lines every 4 to 6 weeks and pay off them in full each closing statement.

In case you miss a payment or go over the limit, which I just did on one of my 0% interest for the next 15 months Chase Visas, call them and ask to let it go. Put it in writing always helps. Of course it helps even more if you have the card or other cards with issuer in question for sometime. If you have an older active and troubled account, make 12 monthly payments on time and then ask the issuer or lender if they can stop reporting previous delinquencies. This often works best if you carry over a little balance and pay some interest to make creditor happy or use it for purchases quite extensively. You can even threaten that you close the account and being a good paying customer for a full year, chances are they want to keep you happy and forgive your old sins. Needless to say that shall improve your credit score fast, and substantially.

If your credit report shows few older than 2 years negative records, such as small collections, missed utility payments or late medical bills, dispute them. There is quite a good chance that collection agencies and even original creditors won't bother to validate insignificant debt amounts which still lower your credit scores.

These steps are almost certain to improve credit score fast and give you quite a nice boost, particularly if your credit scores are under 680. If they are higher, then improvement will be minor, as every negative or imperfect information has been already taken into account by the credit scoring formula.

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