What’s the Fastest Way to Boost My Credit?

boost-my-credit

Article originally published September 1st, 2016. Updated October 29th, 2018. 

It’s a common question around these parts: how do I fix my credit? And, while credit scores do have a lot of nuances, the answer is actually pretty straightforward: pay all your bills by their due dates, keep your debt levels low, add a mix of accounts as you can afford it and voila! — your credit score should rise steadily over time.

Still, for people plagued with bad credit or someone looking to get the absolute best rates on a new loan, waiting it out can seem like an unattractive option — and so the question gets a little more pointed: how do I fix my credit fast?

Truth be told, there are no guarantees when it comes to getting a quick credit boost. Exact point increases will vary depending on your full credit profile and, even if you’re teetering toward top-tier credit, your score’s beholden to a lender’s schedule when it comes to reporting new information to the major credit bureaus.

Most creditors provide updates to the big three bureaus every month — meaning, yes, you can boost your credit in 30 days, but any shorter timeframe is admittedly a long shot.

Still, there are few steps you can take to try to raise your credit score in the short-term. Here’s a breakdown of ten of your best options.

1. Pay Down Your Credit Card Balances

Credit utilization ratio— how much debt you’re carrying vs. your total available credit — is a huge part of credit scores, second only to payment history. But while you can’t just erase a missed payment from your credit file (most negative information takes seven years to age off of your credit reports), you can pretty readily boost your utilization rate by wiping out big credit card debts.

Experts generally recommend keeping the amount of debt you owe collectively and on individual cards below at least 30% and ideally 10% of your credit limit(s).

So, if you’re close to maxing out one card and/or you’re carrying big balances on all of them, paying those debts down can result in a fast boost. Just be sure to pay charges off by your statement’s billing date as opposed to their actual due date because that’s when most creditors will update account information with the credit bureaus.

And, of course, refrain from making any new purchases once the debt’s been eradicated.

2. Ask for a Credit Limit Increase

Essentially, a different solution to the same problem — you may be able to improve your utilization rate by getting an issuer to give you a higher limit on one of your existing cards. Just be sure not to use up that extra credit. Otherwise, this move can have the opposite effect.

And be prepared to see an initial ding to your score — creditors sometimes pull your credit when you ask for a limit increase, and that could generate a hard inquiry on your credit reports and cost you a few points.

You might easily make up those points and then some, however, if the credit limit increase is large enough.

3. Get an Error Removed

Errors on credit reports are more common than you may think, so it’s important not to simply take a bad score at face value — particularly because getting an error removed can be one of the faster ways to fix your credit.

The Fair Credit Reporting Act requires that the bureaus investigate and remove items deemed to be errors within 30 days of a dispute being filed.

That’s why it’s a good idea to pull your credit reports — you can do so for free each year at AnnualCreditReport.com — and routinely review them for any inaccuracies that may be unduly weighing your credit down.

4. Clean up and Polish Your Credit Report

Once you receive a copy of your credit reports from the three major credit bureaus- Experian, Equifax, and Transunion, you can take a closer look at each item that is on there.

You have already read about getting an error removed, and this is a good step to take, but don’t stop there. Look for accounts you have on your credit profile that show late or missing payments and verify the accuracy of each item. If you see something that is wrong, send your dispute so that the problem can be investigated.

5. Attempt to Pay Twice Monthly

Yes, you may be paying your balances each month, and you are paying them on time, but you need to keep in mind that your creditors are reporting your balances to the credit bureaus only once per month.

If you have a credit card, for example, that you are constantly maxing out and reaching your limit on throughout the month, the statement you receive will show the balance. You make the payment, but since it was reported only once that month, it is basically showing that you are using 100% of the available balance on that credit card.

If you send in payments twice a month, however, you are essentially breaking up your payments, and you are effectively keeping your overall credit card balances much lower than if you continue to only pay once per month.

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6. Open a New Credit Account

If you want a nice boost to your credit and you want to help improve your credit utilization ratio, you can consider opening a new credit account. This is especially helpful if you find that your current credit utilization ratio is much too high.

Opening the new account adds to the available credit you have and will show that with the new balance, you are using less. However, this is not a good option if you are already juggling multiple accounts. You may end up hurting your credit instead of helping it if you try to stretch your credit too thin.

7. Open up Negotiations

Have you taken a closer look at the current debt you owe? Have you considered negotiating the debt you have in collections to rebuild your credit? Many collection agencies will be willing to negotiate because they really won’t be losing any money on the debt if you are able to settle for less because they most likely bought the debt account for a minimal price.

It never hurts to open a negotiation to try and settle the debt you have for a smaller and more manageable amount on your credit accounts. If you find that you are unsure about this process, or if you don’t know if it is something you should do, you can always seek the help of a credit counselor to help educate you on the process and offer suggestions as to what you can do otherwise.

8. Become an Authorized User

Another fast way to boost your credit could be to become an authorized user on someone else’s credit account. For this to be a viable and recommended option, you will need to find someone you trust, such as a close friend or relative, that is financially responsible and is willing to do this for you to help improve your credit rating.

As an authorized user on someone else’s account, their account will still show up on your credit report, and their payment history, credit utilization ratio, and credit card balances will become part of your credit history and may award you with a good credit score.  Not all credit card companies report authorized users however, so you will want to make sure that if you do become an authorized user, that the account information will show up on your credit reports.

9. Make On Time Monthly Payments

In addition to paying on your accounts twice a month, you should also make sure to make your payments on time every month. Your payment history makes up approximately 35% of your FICO score.

If you find it hard to remember your due dates, consider placing your accounts on auto pay with reminders so it reminds you that the payment is coming due and it will then automatically make the payment for you.

10. Mix Up Your Credit Choices

Finally, make sure you are mixing up your credit choices instead of focusing on using just your credit cards, for example. Using different types of credit can boost your score fast – even though it wouldn’t be a significant boost.

If you need an appliance, instead of using your credit card, you should consider a small personal loan instead. It shows that you can effectively and responsibly utilize different types of credit.

Fastest Way to Boost Credit After a Bankruptcy

One of the biggest hits to your credit is a bankruptcy and people are often anxious and ready to begin boosting their credit following their bankruptcy. In theory, someone looking for credit after a bankruptcy may actually appear to be less of a risk because they are not able to qualify for Chapter 7 for another eight years.

Following your bankruptcy, it is recommended that you make all your payments on time, learn how to manage your money efficiently, and find ways to reestablish your credit without trying to borrow money too soon and this could prove to be the fastest way to build credit.

You should also keep a very close eye on your credit reports and credit scores from the major credit bureaus and look for any errors or inaccuracies including any mistakes with your address, employment, or personal contact information.

The best way to start improving credit following a bankruptcy is to open a secured credit card account and make your first deposit into the account.

Conclusion

Although these ten strategies are a good start to finding the fastest way to boost your credit, you need to remember that it still may take several months for the credit reporting agencies to report the improvements on your credit report.

While they may be “fast” methods, they are certainly not miracle credit cures, so you need to have a fair amount of patience when it comes to seeing the positive effects on your credit report.

Be sure to dispute any errors you find with the credit bureau in question (you go here to learn how). You can also view two of your credit scores for free each month on Credit.com as you monitor your progress toward building better credit.

The post What’s the Fastest Way to Boost My Credit? appeared first on Credit.com.

Source: credit.com

Why You Need ExtraCredit in Your Life

What do you need your credit score for? In a nutshell, a lot. Credit cards, loans, mortgages, APR, even renting an apartment—whether or not you qualify is based largely on your credit score. If your credit is less-than-ideal, you know it can make your life just that much harder.   

Having a bad credit score can hold you back. It can keep you from feeling in control of your life. You might feel like you’re in a vicious cycle: you apply for credit to improve your score, get denied, suffer a hard inquiry, watch your credit score drop and try again. And it starts over.

We get it. And we want to help. Enter ExtraCredit, the newest product from Credit.com. ExtraCredit is a comprehensive credit solution, with specific and encompassing features that helps you with every dimension of your credit. 

But ExtraCredit isn’t your typical credit solution. Think of it as a lifestyle change. Think of it as a way for you to take your life back. 

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What’s ExtraCredit?

ExtraCredit is your one-stop-shop for all things credit. Need identity protection? ExtraCredit’s got it covered. Want a look at your FICO® Score? Sure! An exclusive discount with one of the leaders in credit repair? Yep, we’ve got that too. Ready to add more to your credit? We’ve got your back. ExtraCredit is here for you, no matter what your credit score is. ExtraCredit helps you own your life—starting with your credit. 

ExtraCredit has five features, each created to help you get where you want to be. Here’s the lowdown on each: 

Reward It

So you decided to sign up for ExtraCredit. Smart choice! Because you’ve made such a smart choice, we’ll send you an ExtraCredit card loaded with $5. That’s real money. And that’s what Reward It is all about.

It doesn’t end there. When you sign up with ExtraCredit, we start sending relevant financial offers your way. Let’s say you get approved for one of those financial offers. That’s a big deal! And we want to celebrate with you. Which is why we’ll load your ExtraCredit card with up to $200. That’s right—up to two hundred dollars. All for you, because of your smart financial decisions. 

Learn More about Reward It

Track It

There are a lot of credit scores out there. And there are a lot of apps and services that claim to have the score. You know, the one and only completely accurate score you need. But the thing is, that doesn’t exist. So the score you might be seeing on one of those other apps isn’t the same as the FICO® Score that lenders see. In fact, you have at least 28 credit scores. That’s a lot to keep track of.

That’s where Track It comes in. ExtraCredit will keep track of your 28 FICO credit scores, so you can keep track of every single one. But it goes one step further by showing you what each score is used for. Plus, you’ll get access to your credit reports from all three major credit bureaus—Experian, TransUnion and Equifax.

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Guard It

Here are some statistics for you: in 2019, 14.4 million consumers were victims of identity fraud. Sure, that might not sound like a lot of people. But when you realize that it comes out to about 1 in 15 people, it feels like a much bigger threat. In total, 33% of adult Americans have been victims of identity theft. 

You might think that you’ve got all the protection you need. And maybe you have set up a few precautions here and there. But criminals nowadays are smart. Just look at those stats! They know what they’re doing. But don’t sweat it—so do we. Guard It’s here to save the day.

Guard It provides services to keep you nice and safe. There’s Dark Web Monitoring, which will continually scan hidden websites and file-sharing networks for data breaches. Then there’s Compromised Account Monitoring that’ll catch unauthorized bank changes and accounts opened with a stolen identity. And last, but not least, there’s Identity Theft Insurance. That’ll help protect you from financial danger with a $1,000,000 policy. Better safe than sorry. 

Learn More about Guard It

Build It

We all know that credit card payments play a major role in your credit score. But that’s just half the story. What about all the other bills that you pay, like rent and utilities? Shouldn’t those count? We definitely think so, which is where Build It comes in.

Build It uses Rent & Utility reporting to match transactions from your bank account. Think about that for a second—Build It will help you add more to your credit profile whenever you pay your rent on-time. How easy is that? 

From there, Build It continues to report your payments to all three major credit bureaus each month. 

Learn More about Build It

Restore It

So your credit’s not where you want it to be. And you need help. The good news is, you’re in the right place. Restore It will connect you with one of the leaders in credit repair. You’ll get an exclusive discount for CreditRepair.com, a credit repair service that has a killer track record. If they are not available in your area, you will get that discount with another leader in credit repair.

Learn More about Restore It

The Breakdown

Okay, we know that there are a lot of credit solutions out there. You’ve probably seen other services, like credit repair, ID protection and credit monitoring. But here’s the thing—no one offers a comprehensive service like ExtraCredit. 

With ExtraCredit, you get five killer features all wrapped up in a box with a bow on top. Here’s a breakdown of how much the ExtraCredit services would typically cost on their own:

  • Basic Credit Repair: $24.95+ 
  • Rent Reporting: $9.99 
  • ID Protection: $34.99
  • FICO Scores: $19.99

Altogether, that’d add up to a cool $89.92. But with ExtraCredit you get all five services at $24.99 a month, plus real cash back for select offers. 

The Bottom Line

Sure, there are a lot of credit solutions out there. But here’s the thing—ExtraCredit impacts every dimension of your credit. So you could go with one-dimensional services provided by the other guys. Or you could go with ExtraCredit, which offers so much more than the basics.

ExtraCredit is here for you. It’s like a team of credit pros, all focused on monitoring your credit and satisfying your credit score needs. All you have to do is sit back, relax and let ExtraCredit do the work. 

ExtraCredit is the last credit solution you’ll ever need. Join the revolution today.

The post Why You Need ExtraCredit in Your Life appeared first on Credit.com.

Source: credit.com

Tips for Building Your Credit

A woman wearing a brown coat and scarf smiles as she throws fall leaves around herself

Your credit
score can affect many aspects of your life—from getting a loan to getting a
job or getting a house. Good credit is necessary for sound finances and many
major purchases. But there are no quick fixes or shortcuts to building good
credit. You must start by establishing credit, then embrace responsible credit
habits over time. This helps you create a record that shows lenders you’re a
low risk and a desirable customer.

The following tips for building your credit help you understand and improve on the key factors that the three major credit bureaus use to calculate your credit score. By following these smart financial guidelines, you can demonstrate your credit worthiness. That makes you a more desirable customer and borrower for many businesses and lenders.


1. Review Your Credit Report

In order to build your credit, you have to understand it. Start by regularly reviewing your credit reports. You can request your free annual credit report from each of the three credit bureaus and assess your credit as it stands right now. Review the following:

  1. Payment history
  2. Amount of credit you’re using
  3. Credit age
  4. Mix of credit account types
  5. Credit inquiries

Our free Credit Report Card can help you understand what is in your credit report and how those things affect your credit score. Our report card will help you identify areas that need improvement and help you make a plan to address these issues.

2. Dispute Errors and Inaccuracies

As you review your reports, keep an eye out for any errors. Credit report errors are not uncommon. In fact, a Fair Credit Reporting study found that one in four consumers found mistakes on their reports that can hurt their scores. You have the right to dispute those errors and fix your credit report. You can do credit repair on your own or hire a credit repair company to help you.

3. Keep Credit Accounts Open and In Good Standing

If you already have available credit, keep the accounts
open. Older credit accounts help assign a credit
age, which makes up 15% of your score. Closing an old account makes it look
like you didn’t start establishing credit until later, which can lower your
credit score.

And if you close a credit card, you also lose valuable
available credit for your utilization rate. It may be better to keep the card
open to support a lower debt-to-credit ratio—just don’t run up the balance.
Make small purchases two to three times per year and pay them off during the
following billing cycle.

4. Make On-Time Payments

Making on-time payments is one of the most important
things you can do to build your credit. Your payment
history accounts for 35% of your credit score. It tells lenders and
potential employers how reliable you are. Missed payments are serious signs of
trouble. Charge offs and defaulted accounts say you can’t be trusted to repay
your debts as promised.

If you are newly establishing credit, avoid late payments
and other poor payment habits. This is one of the two most impactful factors
for building good credit. If you already have a poor payment history, commit to
changing now. Over time, those old payments will have less impact. Eventually,
they’ll even fall off your report.

5. Use a Maximum of 30% of the Credit Available to You

Ironically, lenders would rather not give you credit if
it looks like you need it or you like using it too much. That may seem
counterproductive, since they make their money off loan interest and fees. But
using too much of your available credit is a warning sign.

Maxing out your cards and lines of credit may point to
problems with spending, debt and income. That worries creditors, since it means
you may stop paying your loans. That’s why your utilization rate is a vital
part of your credit score—accounting for 30% of the calculation in most scoring
models.

The most
desirable utilization rate is less than 10% of your available credit. At
most, keep it under 30%. If you make any large purchases on your revolving
credit accounts, pay them off as quickly as possible to keep your utilization
rate low.

6. Open Different Types of Credit Accounts

Having a mix of credit types is a good demonstration of
creditworthiness. This factor contributes 10% to your credit score. There are three
types of credit accounts to consider:

  1. Revolving accounts—credit cards and lines of credit. They have a credit limit and require regular payments.
  2. Installment accounts—student loans, car loans, mortgages and personal loans. The lender provides a lump sum, and you make payments until the debt is paid off.
  3. Open credit—charge cards, utilities and cellphone services. With charge cards, you have a credit limit, and you can make purchases and cash advances, but you don’t carry a balance. With open credit accounts, you need to pay off your charges each month.

To build credit, work toward maintaining an account
from each of these categories—as long as you can afford them.

7. Open a Secured Line of Credit

It may be difficult to build credit if you haven’t
established a credit history yet. If you have poor or fair credit, it may also
be hard to get approval for traditional credit cards or loans. However, secured
lines of credit—like secured
credit cards and secured
personal loans—can help you get started on your path to good credit.

OpenSky® Secured Visa® Credit Card

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Card Details
Intro Apr:
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Ongoing Apr:
17.39% (variable)


Balance Transfer:
N/A


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Credit Needed:
Fair-Poor-Bad-No Credit

Snapshot of Card Features
  • No credit check necessary to apply. OpenSky believes in giving an opportunity to everyone.
  • The refundable* deposit you provide becomes your credit line limit on your Visa card. Choose it yourself, from as low as $200.
  • Build credit quickly. OpenSky reports to all 3 major credit bureaus.
  • 99% of our customers who started without a credit score earned a credit score record with the credit bureaus in as little as 6 months.
  • We have a Facebook community of people just like you; there is a forum for shared experiences, and insights from others on our Facebook Fan page. (Search “OpenSky Card” in Facebook.)
  • OpenSky provides credit tips and a dedicated credit education page on our website to support you along the way.
  • *View our Cardholder Agreement located at the bottom of the application page for details of the card

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To get a secure line of credit, you will need to put up
some form of collateral—usually cash, a savings account, or other personal
property. With this credit option, you may get a decent interest rate. The
lender’s risk is lowered due to your secured asset. This means they don’t need
to charge a much higher interest rate, as is common with poor credit.

8. Limit Credit Inquiries

Be careful when applying for new credit. You don’t want
more than two hard
inquiries every six months or so. Too many requests for credit can look bad
to potential lenders. These inquiries account for 10% of your score. Only apply
for credit if it can help improve your score through one of the methods
discussed above or is necessary for making a large purchase such as a home or
car.

When you do apply, comparison shop. Carefully weigh all
the terms and the chances that you will qualify for the card or loan on offer.
Then, choose only one or two and apply. If you’re turned down, don’t try again
for at least six months.

Build Your Credit

These personal tips can help you build credit and work on improving poor or fair credit. Building good credit habits can have a bit impact on your credit score. Start by signing up for Credit.com’s free Credit Report Card to get personalized advice for your unique credit situation.

Sign up for the Free Credit Report Card.

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Source: credit.com