Just Three Things To Do To Improve Your Credit Score
Take a hard look at your current credit situation.
Make a list of all your debts, no matter how old they are. Write down not only how much you owe, but how much APR each company charges. The higher the APR is, the longer it will take you to pay off the debt. Put the debt with the higher APR at the top of the list, you will want to pay those off first. If you have credit cards with different APRs, transfer your debt to the cards with the lowest APRs. Once you know your debt situation, you will be able to control it better.
Always pay on time.
For many of us, we know paying our car loans and credit card bills on time each month improves our credit score. Yet the little bills also count as well. Electric, cable and rent all need to be paid on time as well. One late payment can knock your credit score down greatly. Even worse, it stays on your credit report for years. If you will not be able to pay your bills on time, call the company. Many will offer extensions that will not reflect poorly on your credit report.
Watch your balances.
It’s a common myth that zero balances on your credit cards will improve your credit score. The opposite is true. While you do not want all your credit cards maxed out, you want to carry a balance. A good rule of thumb is to carry about thirty percent of your balance each month. For example, if you have a credit card with a limit of $1000, keep a balance of $300 each month. While you can charge as much as you want each month, make a monthly payment that will bring your balance down to thirty percent. Also, keep old credit cards open. Closing credit cards will reflect poorly on your credit score.