How to Raise Your Credit Score Once You've Paid Off Your Debt

Debt is a large factor in your credit score. According to MSN Money, the amount of debt you have makes up 30% of your total credit score. After paying off debt, consumers typically see an improvement in their credit score. However, if you're interested in improving your score further, there are a few steps you can take. Focusing on using credit solely to improve your score can help.

Instructions

1

Review your credit report. Errors on your credit report might be pulling down your score. Order a free credit report online from Annual Free Credit Report (see Resources). You are entitled to a free report every 12 months. Look for inaccurate information, such as late payments, collections and accounts you don't recognize. If you find errors, contact the reporting bureau to file a dispute. Correcting this information may raise your credit score.

2

Avoid closing unused accounts. Paying off debt is a large accomplishment. However, getting on the phone and closing all your paid-off credit card accounts isn't the best idea. Leaving these accounts open will improve your credit score. The credits bureaus like to see revolving credit (such as credit cards and home equity lines) open with low (or zero) balances. It shows the bureau you have restraint with credit.

3

Start using old credit cards accounts. If you've paid off your debt, you probably aren't anxious to acquire new debt. However, if you're not using credit at all, you're missing out on raising your score. According to MSN Money, credit bureaus like to see consumers with a lengthy credit history. This accounts for 15% of your credit score. Use older credit cards for purchases and pay off those cards monthly. This will help boost your score.

4

Make payments on time. Once you start using credit again, make sure to pay off your account on time every month. Payment history is the largest factor when determining a credit score, according to MSN Money. It makes up 35% of your score.