There are many ways to improve credit score, but sometimes you need to think outside of the box. While some of these methods may not gain FICO’s nod of approval, they can help repair your credit score and get you in good standing for future purchases.
Make Multiple Payments Throughout the Month
Rather than pay your monthly balance all at once, you can pay in installments every week or so. How does it work? If you pay expenses with your credit card and pay off the balance at the end of each week, you minimize the amount of credit used at once. This lowers the balance on your statement date, and the lower the balance, the more favorable your credit score.
One thing to note is that some credit card issuers limit the number of payments you can make each month. Most will accept up to three payments, but you’ll first want to confirm with your company if you plan to pay weekly or more frequently.
Pay for Deletion
If your account has been forwarded to a collection agency, you may be able to clear the debt from future credit reports by simply paying it off. Many collectors will agree to this type of arrangement if you negotiate. Make sure to obtain a written contract from the company that outlines their promise to erase the debt and refrain from reporting it to the three major credit bureaus. Keep in mind that you’ll most likely have to make a lump sum payment; however, many agencies will settle for an amount less than your original balance. While this method isn’t guaranteed, it can pay off if you talk to the right person.
Report a Lost Card
This strategy should be more of a last resort, but is one of the quickest ways to improve credit score. When you notify your creditor that your card has been stolen, they will likely close the delinquent account and open a new one. This shifts your credit history to the new account, original open date and all. Your future credit reports will then show two positive and nicely aged credit lines.
Dispute Debts Away
Even small unpaid charges such as an emergency plumbing bill, parking ticket, or data overage charge on a phone you no longer use can harm your credit score. More often than not, you can take these up with the credit bureaus and dismiss them. How? Most businesses won’t expend the time and effort to sort through old debts, especially smaller ones, and agree to remove the bad marks from your credit report. While disputing may not clear all your debts, it will likely get rid of some of them.
Add Accounts Not Currently Reported
A smart and honest way to boost your credit score is to add positive accounts to your credit report. Only a fraction of your monthly expenses actually contribute to your credit score. Your credit report might not include bills such as electricity, water, phone, internet, and other services you use every day. Why let all your on-time payments go unnoticed? If you contact these companies, there’s a good chance they’ll agree to report your payments to the credit bureaus, thereby boosting your credit score.