Improve Credit Score Easily
Edited by Melvin Magadia, Eng, Lynn, Adrian Penaflor and 1 other
Keeping a healthy credit score can have an impact on your financial credibility.
A healthy credit standing will help you get good rates when applying for a loan or credit card. On the other hand, a bad credit score will lessen your chances of buying the dream house you have long wanted. The good news is that you can still do something to increase your credit score. This will not happen overnight, but you need to be determined in taking the necessary action to raise your credit score.
Here are some steps you can consider to raise your credit score.
- 1Obtain your credit report
- First things first, you need to secure for yourself a copy of your credit report. Exercise your right to get a copy of your credit report from the credit bureaus, namely Equifax, TransUnion, and Experian.
- It is recommended to get a copy from all the bureaus as they may have some differences. Your credit score is based on different formulas, but it will all result in one common score called the FICO.
- 2Check for discrepancies
- Once you get hold of your credit score, check for any inaccurate information. Studies have shown that 20-25 percent of credit reports have discrepancies. There are various factors that could lead to these discrepancies. For instance, it may have been a case of mistaken identity.
- So always verify the information on your credit report to make sure that it really belongs to you.
- 3Dispute any irregularities
- Aside from personal data, your credit score may also indicate late payments that were actually paid promptly or closed accounts still declared as open. If this is the scenario, you can dispute your report by sending a letter to the credit bureau. Identify the errors you believe they have committed. There are hundreds of sample letters online as well as supporting documents.
- Once they have received the letter, credit bureaus are given 30 working days to investigate, correct, or delete the error. Unverified negative information should also be removed from the report. Again, you should get for yourself a copy of the corrected report. You can have the credit bureaus send the correct report to anyone who has inquired about your record.
- 4Make timely payments and settle your debts
- Another way to boost your credit score is to pay your bills on time and pay off your debts. Keep in mind that default in payments made several years ago will not have much bearing on your score as much as the new ones.
- Likewise, you should also settle outstanding debts. When paying a loan, do not close the account, as this will help increase your credit score. A closed account can decrease your credit score, so keep these open as much as possible.
Categories : Financial
Recent edits by: Adrian Penaflor, Lynn, Eng