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7 Things You Should Do Right Now To Improve Your Credit Score

Your credit score is like any relationship. And while it may not require you to be quite as sensitive as a significant other, it does take paying attention to, but even with the best of intentions, things can get a little rough at times. Perhaps your bills have been late a few months in a row, and now your credit has taken a dip. 
You’re not alone as tens of millions of people in America have sufficient negative information on their bureaus to affect their ability to get loans and credit cards with reasonable terms. Or perhaps your credit is OK, but you’d like to improve it. If your FICO score sits above 760, you’re probably in the best terms on any lending you are engaged in. If it’s below this, you could do better.
Here are 7 ways to fix, some of them quite fast, your credit score.
 
1.  If you don’t have one, get a credit card now
Many people think that credit cards aren’t worth it, or that they offer too much of a risk (especially those of us who just can’t quite control ourselves with great deals we can’t quite afford on our own), and have no open revolving lines (what the bureaus call credit cards). But credit cards are 33% of your FICO score, and you need them to have a healthy credit report. You don’t need to carry a balance, but you should be using the card monthly and paying it off. It’s good to have one, but two is what the bureaus are looking for. Our suggestion, keep two open, and set up automatic payments for something small, a credit-monitoring service perhaps, and pay it off monthly.
 
2.  Add an installment loan
Credit cards are revolving, and other loans (personal, auto and student loans) are called installment credit. It’s good to have a mix of revolving and at least one installment to have a very healthy FICO score. If you don’t have any installment, you may want to consider getting a small personal loan from a community bank or Credit Union and paying it off over time.
 
3.  Pay down your credit cards/use them lightly
Paying down installment loans is considered good, but paying off your revolving limits can have dramatic positive results when it comes to your credit report. Lenders like to see a big gap between what is available to you and what you are currently using. As we’ve mentioned earlier on this site, your total revolving balance should not exceed 30% of what you have available, and getting it under 10% is considered optimal. If it’s a quick fix you need, consider paying down those cards that are closer to their limit over the cards with higher interest; but again, this is only if you need a quick improvement.
 
4.  Pull out an old card
The longer the history on a card, the better it is for your credit. If you are not using a card and it is just sitting there, a lender may close the account or stop reporting it to the credit bureaus. They may still appear, but they do not carry as much weight if you never use them. So if you have a little-used card, consider using it when you go out to dinner once a month, or set up a recurring bill, always remembering to pay it in full.
 
5.  It can’t hurt to ask
If you’ve been a good customer, you can ask a lender to erase that one late payment from your account history. If you are looking for a loan, even one “30 day late” tick on your report can have dramatic effects on your terms. Most of the time these requests must be made in writing, but it can’t hurt to ask and could make a big difference in your score. 
 
6.  Dispute negative information
Lets say you took your cable box back to your provider but they then come back and say they have no record of it, unfairly leading to a collection on your report. You can continue to protest the account as unfair, or you can try disputing the collection directly with the bureaus as “not mine.” The older and smaller a collection account, the higher the chance a collection agency won’t bother to verify it when the credit bureau contacts them for the investigation. 
 
7.  Pay attention to significant errors on your reports
Your credit scores are tabulated with everything that reports, but not everything that reports is tabulated in your scores. And like anything in life, sometimes there are mistakes. If you find some, here are the biggest ones to dispute. 
 
--late payments, charge-offs, collections or other negative items that aren’t yours
--credit limits reporting as lower than they are 
--accounts listed as “settled,” “paid derogatory,” “paid charge-off” or anything different from “current,” or “paid as agreed” if you paid in full
--accounts that are still listed as unpaid that were included in a bankruptcy
--negative items older than 7 years (10 for a bankruptcy) that should have fallen off your report.

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