Tips to Raise Your Credit Score Fast

If you are preparing to purchase a home, finance a car or apply for a loan, you may be thinking a lot about your credit score. When you have a higher credit score and better credit profile, you pose less risk to a lender. Less risky credit applicants are more likely to be approved for credit. If your credit score is less than stellar and you need to raise it fast, follow these tips for improvement.

Raise Credit Limits

One of the major factors that affects your credit is your level of debt in comparison to the credit you have been extended. If you have a credit card with a $1000 limit, and you owe $900 on that card, your debt ratio for that card is 90 percent. A portion of your overall credit score is computed by taking an average of all your credit accounts and the corresponding balances. Generally, if you owe an average of 50 percent or less than your available credit, your credit score will be higher. If your creditors provide the option to raise your credit limit, accept the offer, but do not utilize additional credit made available to you. A higher percentage of unused credit can translate to an instant increase in your score.

Pay Down Debts

In addition to having a lower debt ratio when compared to the amount of available credit, a lower level of overall debt can also increase your credit score fast. Creditors like to see that you have the ability to pay off debt in a timely manner, and you are considered less of a credit risk when you owe less money to fewer creditors. If you have more than five credit accounts and extra cash handy, consider paying off one or two accounts. Eliminate smaller balances first, and use the rest of your available funds to make a dent in higher balances. A lower debt level can translate to an increased credit score in a matter of two or three months in some cases.

Dispute Charges

Dispute the charges if you have anything incorrect on your credit file. Credit card companies and reporting agencies often make mistakes that can negatively affect your credit score. Call the lender directly and request an update to their reported status, if possible. Send a certified letter to each of the three major credit bureaus, Transunion, Equifax and Experion, and request that your credit file be updated to remove inaccurate items. Appropriate adjustments to your credit file can boost your credit score instantly.