How to Increase Your Credit Score After Paying Debts

One of the most important pieces of advice given to a person with a bad credit score is to pay down all of your debt so you have a clean slate. However, once you have your debt gone, you may wonder why your credit score doesn't magically rise. After you pay off your debt, there are still a few things you need to do to get your credit score to go up.

Instructions

1

Continue to use your credit cards. Credit scores are based on how well you manage your debt. Once you pay off your debt, you will have nothing to manage, meaning that the score will not change very much from where it ended up. Use an older card for the best results as credit bureaus will look at the older credit before they look at newer credit.

2

Keep your limits low. When you are using the cards again, don't get sucked into your old spending habits. Spend what you need to spend and pay off as much of the card as you can. A good rule of thumb is to keep the amount of debt on any card to less than 30 percent of the limit.

3

Check your credit reports to see what limit your creditors have listed. If they are listing your credit limit as less than what it actually is, this can hurt your credit score. Call them to make sure they are listing the correct limit on the reports.

4

Ask for good will on your cards. If you have been an exceptional customer and have diligently paid your credit bills, they may forgive a late payment, which will help raise the credit score.

5

Look for any major discrepancies in your credit report. These are not limited to incorrect limits, but can also include accounts that are listed with anything other than "current" or "paid as agreed," negative items which are older than seven years or accounts that were included in bankruptcy that are are still showing delinquent.