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10 Steps to Improving Your Credit Score

Improving Your Credit Score
If you cannot borrow money, get a home or have more choices due to a poor credit rating, improving your credit score is your top priority. This will help you be in the good books of the lenders or specific institutions once again. Improving your credit score should not be hard. Once you know the factors that FICO weighs in calculating credit scores and changing these for the better, you can improve your credit rating.

In this article, we shall discuss 10 steps you can take to improve your credit score. Once you follow these steps over time, your credit standing will improve.

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Here are the 10 steps to follow in Improving your Credit Score:

1. Check for errors and inaccurate information in your credit report

inaccurate information in your credit report
To check if your credit report has errors, request, once annually, a free copy from Equifax, TransUnion, or Experian. You can also get a copy from credit monitoring services.
Check your report for any inaccurate information that’s negatively impacting your score. If you spot them, send a letter to your credit agency explaining the inaccuracies. Have a certified letter and copies of documents to verify your claim. Once these errors and inaccurate information are corrected, your credit score should improve.

2. Make on-time automatic bill payments to meet deadlines

bill payment before due date

Any late payment to your mortgage, credit card accounts, utility bills, or car loans can damage your FICO credit score. Your payment history accounts for 35% of the total score, which means that late payments should be discouraged. One of the best ways of improving your credit score is by automating your bill payments.

Therefore, you should maintain consistent on-time bill payments if your credit rating is low. Even though FICO claims to take up to two years of timely bill payments to improve your score, the earlier you improve on this front, the better.

3. Consider paying debt and lower your credit utilization ratio

The amount of money you owe and the total credit available to you is known as credit utilization; this is another factor that FICO uses to calculate your score. You need to maintain or remain below a 30% credit utilization for every account or across all accounts to improve your rating.

The creditors and lenders consider the utilization ratio when lending. Those with higher utilization ratio are considered less likely to pay back. In this regard, you need to consider paying your debts to improve your credit score.

4. Missed Payments? Act now.

Man worried about bills holding hands on head being stressed with debts.
Even if you have missed a payment or two, it is never too late to improve. Start making your payments as soon as possible and remain current. It is possible to improve your rating within six months of making payments. Keep in mind that not paying your debt will be a negative impact on your score and won’t help with making it better.

5. Request an increase to your credit limit and keep your debt well below it

Once your credit limit is increased, this automatically lowers your credit utilization ratio. Another thing that can easily improve your rating is by keeping the amounts you owe well below the credit limit. You can pay your credit card and other debts to improve on this.

To achieve a credit limit increase, you can do this periodically. Credit card companies have different limits and different processes to do this. Do it gradually. Small credit limit increases are appropriate as your credit card companies will not make a hard inquiry on your credit reports. Such an inquiry would be detrimental to your credit standing.

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6. Do not close old accounts

old account cloasing
Hold on to your old accounts whether or not you are using them. Most people will rush to close such accounts because they no longer need them; this is a mistake because it shortens your credit history.
It is advisable to close the relatively newer accounts instead of the old ones. Remember also that closing older accounts does not erase bad payment records. Old or closed accounts also contribute to the credit score with the FICO considerations.

Another secret with the old accounts is to use old credit cards. Since the credit industry closes old or inactive accounts since the credit crunch, do everything to avoid this. Put a charge on old credit cards at least once a month; this keeps these accounts active and ultimately enhances your credit score improvement.

7. Demonstrate responsibility in borrowing and repayments

credit score improvement

Your ability to handle credit responsibly is a good step to improving your score. In this regard, you should not borrow too much. Also, ensure that you make timely repayments. It is detrimental for one to open many accounts to increase available credit. This may work negatively for people who are new and are establishing a credit history.

Opening too many accounts is not only risky but also lowers the average of all the accounts. You should only open new accounts when necessary.

8. Be added as an authorized user of credit cards

This is another strategy that works to improve your credit rating. Ask a friend or a relative with an account or credit card in good standing to add you as an authorized user. This status will allow you to improve your rating based on the positive payment history of the card or the account.
Also known as credit piggybacking, this strategy can potentially benefit credit newbies or those with a low rating. Ensure the accounts report to the three credit reference bureaus.

9. Use of a secured credit card

This is a card that one uses after they load it upfront. The amount of money one deposits on the card equals their credit limit. With the secured card, making deposits on it is a sure way of improving your credit score when you make on-time deposits.
Always use a secured card that reports to the three credit reference bureaus. If you are new to credit scores or have a poor credit rating, this is a suitable step to better rating.

10. Contact your creditors

contact with creditor
If you are undergoing hardships that make it difficult to meet credit card payment deadlines, contacting your creditors is a good move. Some of the lenders have temporary hardship intervention programs that could benefit you. They may establish a payment model that could help you not drop your credit score.


One needs to know that improving your credit score is not a one-day affair. Whether or not you are borrowing money from a credit union, a bank, or a microfinance institution, always remember to borrow wisely and repay promptly; this is a sure way of credit score improvement and having better financial and living options available for you in the future.
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