1. Pay your bills on time every time. Again, this is the single largest factor, 35%, effecting your credit score. We’re talking rent or mortgage, utilities, car note, and phone, as well as your credit card billsâ€â€everything. If you won’t commit to doing this, almost everything else you try to lift your score will be less effective, so stop looking for a way around this one.
2. Pay down your balances to no more than 50% of your available credit. Better yet, bring it down to 30%. In other words, if you have a $15,000 limit on one credit card, you want to get that balance down to between $5,000 and $7,500 owed as quickly as possibleâ€â€and keep it there. That guideline should apply to all of your consumer debt.
3. Always pay more than the minimum due. This will help you to get your balance down more quickly, and save you money on interest payments over time.
4. Stop creating new debt. You have two choices: 1. lock up your credit cards so that you can’t use them (some recommend freezing in a block of ice in the freezer) or, 2. pay off all charges made during the month IN FULL or pay the minimum payment plus all new charges each month. This means if you plan to charge $60 for dinner at a restaurant and $150 for a new outfit this month, and your minimum payment due is $120 on your next bill, then you need to be prepared to pay $330 toward your next bill. Check yourself before you wreck yourself: It’s probably a better idea to just lock away the credit cards.
5. Guard your identity as if your life depends on itâ€â€because it does. Review your credit reports at least twice a year, in addition to any time you plan to apply for new credit. If you find discrepancies deal with them immediately. Get a shredder, and use it to destroy all documents, including junk mail, containing your personal information. The last thing you want to happen is for someone to steal your identity and create bad credit in your name.
(from BlackEnterprise)
Qualifying For Success » 5 Ways to Boost Your Credit Score
[...] 5 Ways to Boost Your Credit ScoreWe’re talking rent or mortgage, utilities, car note, and phone, as well as your credit card billsâ€â€everything. If you won’t commit to doing this, almost everything else you try to lift your score will be less effective, so stop looking … [...]
June 20, 2007 at 9:41 am
Fredric
good advice. i use the amex gold that requires the 30 day payoff for regular expenses.
for big purchases, i have a visa and discover. i only carry one of them.
the amex gold is probably the best way to handle your credit only b/c you have to pay it off.
June 20, 2007 at 10:23 am
Mark Bustamonte
Great advice. Here’s one more, learn to live debt free or better yet learn how the banking industry makes money on interest and apply similar strategies to your financing. There are 2 types of people in this world, those that pay interest and those that earn interest. For more information on this concept visit Tri-Star Consulting Group, LLC website.
June 20, 2007 at 5:43 pm
loan
My college loan doesn’t fine me if I pay late. I always make sure to pay it before the next cycle begins. Does that hurt my score?
June 20, 2007 at 6:28 pm
Fredric
from my experience, student loans generally have a little grace period of around 30 days. this will affect your credit score badly, if you pay late, so be careful.
to make sure, call them up and ask!
June 21, 2007 at 8:53 am
ybpreader
I still don’t get how not paying your bills-rent, utilities affect your credit score. You’re not paying back ‘borrowed money’ cos that’s what credit is.
June 21, 2007 at 10:16 am
Fredric
credit is all about reputation. when you apply for a loan, an apt, or any service for that matter, they may check your ‘history of paying’. your credit score is simply a number that reflects on how well you keep your promises.
if you don’t pay money that you contractually said you would, whether you borrowed or not, those companies and ‘creditors’ can report that to the credit bureaus and eff up your credit score.
having bad credit not only means that you won’t be able to borrow money when you need it (home loans, business loans), but if a bank does take a chance, they’ll charge you higher interest rates.
June 21, 2007 at 2:47 pm