I don't want to mislead anyone. These five tips are great ways to help increase your credit score but you'll still need to pay your debts down and pay them on time. Paying your bills on time is the number one method to repairing you credit. This should be so obvious I didn't even include it with the five tips. Consider it a freebie!
See where you stand
Before you can begin reestablishing your credit you need to know exactly where you stand. That's the easy part and it will cost you less than fifty bucks in the US. You can't fix what you don't see so don't skip this step. You can actually hurt your credit by fighting a negative that's not even on your report and there may be mistakes and unfair derogatory information that needs to be corrected.
Getting The Report
I haven't seen a service yet that actually offers a truly free credit report that includes your credit score. The ones that advertise free credit scores are using the ploy to get you to join their credit monitoring service or some other membership that requires a monthly fee. I recommend you just buy a report that includes the three available reports and scores from TransUnion, Experian, and Equifax. A few minutes researching the top search engine results for 'Credit Report and Score' should help you find a reliable site to buy your report from.
Lets Get Started...
1. Increasing the difference between your account balance and the credit limit of each card can increase your overall credit score. Pay down your credit card's balances and the balances of other revolving accounts such as lines of credit. The bigger the gap the better off you are.
2. Here's one that entire businesses have been built just by providing this service. It's disputing old negatives. The idea is to get negative items pulled from your report by disputing the report in hopes that the creditor or collection agency won't bother to verify it within the allowed time period. It's a quick and easy way to 'slim down' those negatives before you start tackling the project from other angles. You definitely want to look for and dispute inaccuracies.
3. Here's one that I personally tried back in my twenties and it worked great. Let's say you're getting a couple grand from your income tax refund this year. Take a thousand dollars of that and go talk to your bank. Propose the idea of getting a secured loan using your cash as security. You won't be able to withdrawal your funds until you pay off the loan but you won't lose any money other than the interest paid either. It may seem silly to borrow your own money and pay interest on it but you're repairing your credit. Be sure you make all payments on time every time and if you decide to pay it off early be sure you make several on-time payments first.
4. Here's another one I've personally seen work. You need the cooperation of a relative with good credit for this one. Say dear old Dad has been paying his bills on time for years and he has fantastic credit and several credit cards. Simply ask him to contact the credit card issuers and add your name to the account. They will send him cards in your name but it's still his account but now a little of his good credit will rub off on your score. It won't hurt him unless you do something stupid like actually run up the account and cause late payments. Remember, the idea is to improve your credit score not get your hands on someone's credit cards. You don't need to use or carry the cards for this to work.
5. Be sure the credit limits being reported to the bureaus is correct. The credit limits on your credit reports may be out dated and showing lower than they actually are. If that's the case ask your credit-card issuers to update the credit limit information to help your score. Remember tip number one? This will help increase that balance to limit difference to help boost your overall score.
These five steps should get you started on the path to enjoying a good credit history and ultimately lower interest rates, insurance premiums and other benefits of a high credit score.
Brian Hawkins runs many websites and enjoys writing tips and articles for his money saving Blog CheapAzz.net. Brian also enjoys Blogging and has eight Blogs of his own at last count. Don't forget to subscribe to CheapAzz.net's RSS feed for the latest articles about cheap living with class.
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