How to Help Raise My Credit Score

On average, a person with a poor credit score will end up paying hundreds of thousands of dollars more over the course of their lifetime than a person with a good credit score. This is due to the fact that your credit score determines how much you'll end up paying for mortgages, credit cards, consumer loans, insurance and a myriad of other items. Typically, a good credit score is a score over 700; a poor credit score is a score under 619; and an average score is everything in between. To raise your credit score to a higher level, you should pay attention to five main factors: payment history, current debt, credit history, applications for credit and credit mix.

Instructions

1

Pay down the balances on your credit cards. Paying down the balances of credit cards has a larger positive impact on your credit score than paying off installment loans such as your mortgage. Also, for maximum results, keep your balances below 30 percent of the total credit limit on each account.

2

Pay all your bills on time every month. Any delinquent or missed payments will have a negative impact on your credit report.

3

Use your credit cards lightly. Charging anything over 30 percent of your credit line, even if you pay it off in full at the end of the month, will negatively affect your credit score. When you use your credit cards, it's best to only charge small balances and never go over the 30 percent mark.

4

Check your credit report for inaccuracies. You should regularly check your credit report to verify that the information contained in it is correct. Once every 12 months you are entitled to a free credit report from each of the three credit bureaus through the Annual Credit Report website.

5

Use your oldest credit cards. The oldest accounts on your credit report have the greatest impact on your credit score. You'll want to keep these accounts active and regularly use them so the card issuers will continue to update your account information with the credit bureaus.

6

Get some goodwill. If you're a loyal customer with a lender, but have had one or two mishaps with them in the past, they may be willing to remove these items for you. All you need to do is call them up and ask.

7

Dispute old negative accounts. You can dispute old accounts by claiming they're not yours and if the validity of the account cannot be verified by the credit bureau, the item will be removed from your credit report.

8

Resist the urge to open new accounts too rapidly. Too many credit inquires in a small amount of time can have a negative impact on your credit report. Only open a new line of credit when you really need it.