5 Ways To Improve Your Credit Score
Here are five simple ways that you can help improve your credit score.
Is buying a home on your to-do list this year? If so, it may be time to start addressing your credit score. While it's possible to qualify for a mortgage with scores in the 500s, higher scores are going to mean more options, better rates, greater affordability, and more buying power. There's no magic button to raise your score overnight but, here are five quick and easy ways to improve your credit score:
1. Pay off collection accounts. Some older collection accounts aren't worth paying off if you're strictly looking to boost your score. However, if you're able to pay off some of the newer accounts, you could see a bump in your score. Financial experts agree that it’s better to pay off the original creditor instead of a collection agency.
2. Pay down your balances. The amount you owe represents 30% of your score. FICO also looks at the amount you owe as a percentage of your available credit. Keeping your credit card balance relatively low could boost your score. Aim for 30% or lower.
3. Get a credit card. A credit card can be a free way to build up your credit, as long as you use it responsibly.
4. Dispute any inaccuracies on your credit report. You should check your scores for inaccuracies because inaccurate information on your credit reports will drag your scores down. If you see errors, dispute that information and get it corrected right away.
5. Sign up for automatic payments. Payment history makes up 35% of your credit score. Timely payments should be a top priority. Setting up automatic payments can help you avoid mistakes.
If you have any further questions or would like us to connect you with a lender that can help you, give us a call. We look forward to hearing from you.