Thinking about applying for a mortgage? Need to work on your credit? No activity is guaranteed to improve your credit within a short timeframe, but there are quick, simple actions you can take to try for fast results.
Correct errors on your credit reports
Request free copies of your complete credit reports from the three major credit bureaus on the site annualcreditreport.com. Look for items that aren’t yours, balances that have been paid, items that have been reported multiple times, and other mistakes. Most credit report disputes must be resolved in 30 days. You can learn more about disputing errors on your credit report here.
Make strategic payments
Your payment history contributes the most to your credit score. Late payments generally stay on your credit report for seven years. To make all your payments on time, try putting all your bills on automatic payment. Pay any outstanding bills that haven’t been sent to collection first. Then pay off bills sent to collections. If the bill has been charged off, make sure you can pay it in full before paying on it at all. Otherwise, the clock starts ticking on the collections process again and the item will stay on your account for another seven years.
Decrease your credit utilization rate
Pay down balances so your credit utilization is less than 30 percent. You can also ask your credit card providers to increase the limits on the cards you own. If you have a good history of payments with your credit card, there’s a good chance they will negotiate. A request for a credit limit increase may result in a hard inquiry on your credit report, which can ding your credit scores, so use this strategy carefully.
Have someone with great credit add you as an authorized user to a card that they’ve had for a long time. Authorized users benefit from responsibly managed accounts because these accounts will be listed on the user’s credit report. Another idea is to open up a new credit card, which can increase your total credit line and your utilization should improve. If you apply for a card every time you’re asked whether you want 10% off your purchase today, you’ll take a hit on the number of recent inquiries.
If you are within striking distance of a certain credit score needed to accomplish your goals, taking some or all of the steps listed above may help put you over the finish line. Learn more about purchasing a home and find a REALTOR® to help by visiting Three Rivers Association of REALTORS® website.
Correct errors on your credit reports
Request free copies of your complete credit reports from the three major credit bureaus on the site annualcreditreport.com. Look for items that aren’t yours, balances that have been paid, items that have been reported multiple times, and other mistakes. Most credit report disputes must be resolved in 30 days. You can learn more about disputing errors on your credit report here.
Make strategic payments
Your payment history contributes the most to your credit score. Late payments generally stay on your credit report for seven years. To make all your payments on time, try putting all your bills on automatic payment. Pay any outstanding bills that haven’t been sent to collection first. Then pay off bills sent to collections. If the bill has been charged off, make sure you can pay it in full before paying on it at all. Otherwise, the clock starts ticking on the collections process again and the item will stay on your account for another seven years.
Decrease your credit utilization rate
Pay down balances so your credit utilization is less than 30 percent. You can also ask your credit card providers to increase the limits on the cards you own. If you have a good history of payments with your credit card, there’s a good chance they will negotiate. A request for a credit limit increase may result in a hard inquiry on your credit report, which can ding your credit scores, so use this strategy carefully.
Have someone with great credit add you as an authorized user to a card that they’ve had for a long time. Authorized users benefit from responsibly managed accounts because these accounts will be listed on the user’s credit report. Another idea is to open up a new credit card, which can increase your total credit line and your utilization should improve. If you apply for a card every time you’re asked whether you want 10% off your purchase today, you’ll take a hit on the number of recent inquiries.
If you are within striking distance of a certain credit score needed to accomplish your goals, taking some or all of the steps listed above may help put you over the finish line. Learn more about purchasing a home and find a REALTOR® to help by visiting Three Rivers Association of REALTORS® website.
