Repair Credit Score With These Four Easy Steps
If you have made some past financial mistakes or just have some negative information on your credit report and need to give your score a boost then follow these simple steps to do so. When your credit score is calculated it is a complex algorithm, however there are some simple things you can improve to increase your score.
1. New Credit Lines
If you open a new credit card or finance a purchase just by paying your monthly bill on time you can create some positive payment history on your credit record. Your payment history is roughly 30% of your overall credit score in other words a very critical piece of information.
It is important to make sure that this new credit line will report your payments to the credit bureaus. Don't fall victim to getting a credit line that is going to charge you high fees and not report your account activity to the credit bureaus. If your account does not report to the credit bureaus then it will do nothing to improve your credit score.
2. Pay Off Credit Card Debt
The experts say you want to keep the monthly balance on your credit card at about 30% of your credit limit. For example if your credit limit is $1000 then you should keep a monthly balance of about $300.
You want to do this because it shows the credit bureaus that you do use your credit, and you use it responsibly. Additionally if you have another $700 on your credit card that is unused it will improve your ratio of available credit to debt. This piece of information is another critical factor when your score is calculated and the more available or unused credit you have the better off you are.
3. Make Large Payments
It is rumored that by making a large payment on your credit card account you will show the credit bureaus that you are in a secure financial position in life. For example if you have a $500 balance if you pay $400 on your monthly payment, we have heard this will give your score a boost.
4. Remove Errors From Your Credit Report
It is estimated that 25% of all credit reports contain an error on them. This error could be costing you higher interest rates, large down payments, and may be the difference between approval and rejection.
You can dispute this error by writing a dispute letter and sending it to all three credit bureaus or you can hire a credit repair service to do this on your behalf. Once the bureaus receive your dispute they are required by federal law to investigate the item and verify it with the lender.
Frequently investigations by the bureau results in the removal of an item from your credit report. This is because lenders rarely will spend the time or resources to verify the old debt with the credit bureaus and if this debt is not verified them it must be removed from your credit report.
At the end of the day you don't just have to live with a low credit score you can take steps to improve this. We are living in an unprecedented financial times where getting credit has never been more difficult.
Additionally we have seen a sharp increase in potential employers checking a job candidates credit report before offering them a position. Stop letting your low score prevent you from living the life you deserve or getting the job of your dreams.
About the Author
For a free credit analysis call 1-800-768-3386 or visit us for more about how to repair credit at http://www.lvnvfundingcollection.com/how-to-repair-my-credit-rating.html
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