While having great credit opens the doors to several kinds of perks, not everyone is at the stage of having that kind of credit. Many people are stuck with the fair or even bad areas of credit score ranges. These scores make people make drastic decisions as a result.
Those in that area often lead to steeper terms for lending and a smaller access to loans or credit cards.
Getting out of that zone can be awful, however there are tons of ways to build your score up. In fact, these 8 methods below can help you boost your credit score by up to 100 in a short period of time.
The reason people are able to achieve that is because there are more factors playing against those with smaller scores. What’s even better is the fact that even small changes can cause your score to jump up from lower levels.
Below are the 8 simple, but super effective methods that’ll boost your score when applied.
Pay Your Bills On Time
Naturally, paying bills late will always hurt your score, so paying them on time will help.
Missing bill payments can hurt a lot with those penalties lingering for seven years.
Mind you, missing a bill payment by a day or two is fine. However, if it’s been 30 days or more, be sure to call that creditor immediately. The reason for that is that you and the creditor can come up with a payment plan to ease the burden. Furthermore, it can lead to the creditor not reporting the payment as missed to the credit bureaus.
Even if your creditor refuses to do those things, you can still get on top of the account. Each month you’re not paying will only hurt your score in the end. So take some time now to call up your creditors to see their stance on your payments. From that, learn to prioritize your bills.
This strategy works because missed payment penalties do fade away eventually. And if they’re replaced with good standing payments then that’s a good start to boost your score.
Make The Payments Often
One strategy for paying bills is to make small payments – often called micropayments – over the course of the month. This can ensure your balances stay down and can improve your credit as well.
Making these payments often can also help you in something called credit utilization. Credit utilization is another factor that impacts your credit score.
By keeping that utilization low by the end of the month, it can benefit you in so many ways, since you’re not letting bills pile up and sit until the end of the month.
Another rule you can enforce on yourself is to pay the bills as soon as they occur. This is especially helpful with credit cards. Paying for purchases the day you make a purchase with your credit card will only help you.
Ask For Higher Limits
This can be tricky to ask if your credit score is still quite low, but it’s something to consider when moving forward. The idea with raising your limit is that it can help you boost your credit score provided that your spending habits stay the same as well.
The reason this helps you is that it impacts your limit utilization rate and having it 30% or lower will make it easier to boost your score.
In terms of asking for higher limits, it’s a matter of calling your card issuer and asking if it’s possible to get a higher limit without a “hard” credit inquiry being placed on it – which will temporarily drop your score.
Dealing with that stuff during the current times is beneficial, since many are willing to work with people during the COVID-19 crisis. Furthermore, if you’ve got an increase in wages from work, this can be reason enough for banks to extend these limits.
Dispute Any Errors You See On Your Credit Report
Sometimes the credit bureaus make mistakes on your credit reports. Those mistakes can inadvertently drop your credit score. Naturally, fixing these issues can help you in changing your credit too.
The good news about this is that you’re able to get a free annual credit report from the three major credit bureaus: Equifax, Experian, and TransUnion. You can look at all three and determine if there are any errors mentioned in them.
If there happens to be any, you can request the errors to be investigated and removed. From that point, the bureau will have 30 days to investigate and respond to you.
Be An Authorized User
Another way to boost your score is being an authorized user for someone else. If you’ve got friends or family that have a history of responsible credit card use, high credit limit and overall are in great standings, you can ask them if you could be an authorized user.
The best thing about this is that the friend or family member doesn’t even have to let you use their card or even tell you their account number – all this will do is boost your score.
This works in situations where you have a thin credit file. Since you’re an authorized user, their history will be merged with yours, fattening it up and giving you the perks that higher limit individuals can enjoy.
Use A Secured Credit Card
Another method to build credit is through a secured credit card. What are those? They are credit cards that are backed by a cash deposit, rather than a set limit. While this is a bit cumbersome – since you have to deposit money in advance before purchasing, it’s no different from a debit card. It’s secure and it sets a hard limit for how much money you can spend.
Keep Credit Cards Open
If you’re really in a hurry to boost your score, it’s smarter to keep credit card accounts open – even if you are in debt with them. Closing these accounts will only make matters worse. Why is that? Well, for one you lose that specific card’s credit limit and the credit utilization it had.
Even if they weren’t the greatest, they still contribute to your score in the end, so keeping that account open will help.
Change It Up Sometimes
The final method to keep in mind is to mix things up a little. What we mean by this is if all your accounts are in either loans or credit cards, getting different kinds of credit can improve your credit mix. Having a mixture of both can boost your credit score, as this gives you a perceived creditworthiness.
If you’re looking to supercharge your credit score, practicing these 8 methods will help you to raise your credit score in a big way. Do consider trying these out.