How to Increase Your Credit Score Faster

Like losing weight, any quick fix to try to improve a credit score is likely to fail. While taking a loan to wipe out all debts will improve a credit score in the short term, unless there is a fundamental change in lifestyle, debt and poor credit management will slowly creep back. A person who has disciplined themselves to save, to spend less than they earn and consider long-term results of present actions will increase their credit score quickly, and more importantly, keep the score high.

Instructions

1

Go to the three consumer credit rating companies and get your credit score from each one. You are allowed one free report per year. The companies are Equifax (equifax.com), Experian (experian.com) and TransUnion (transunion.com). Credit score is the number these companies use to rate an individual's creditworthiness. The score is officially called a "FICO" or Fair Isaac Corporation score. This is a number between 350 and 850 based on a person's reported default, current amount of debt, and the length of time the person has made purchases on credit. A score of 650 is considered, "fair," while 750 or higher is considered, "excellent." Since each of these companies has access to different information and different reporting systems, everyone's credit score might be slightly different with each company.

2

Look over your credit report for mistakes. It is possible you have been a victim of identity theft and someone used your name or social security number to apply for a loan or credit card. It is possible a bank or credit card company you use has made a mistake with reporting how much debt you have or if you were late with payments. Any mistake can be appealed by contacting the consumer credit rating company and filing an appeal. It is also important to gather information from the bank or financial institution that made the mistake and have them file an appeal with the FICO companies as well.

3

Pay off debt such as mortgages or credit card balances as quickly as possible, but do not close the accounts. FICO scores consider how much credit you have available in ratio to how much you have used. If you close a credit card, you've lowered your FICO score since you no longer have that amount of credit available.

4

Cut any unessential spending. You can go on vacations and make large purchases at a future date when your credit score is higher. Save as much money as you can to eliminate all debts. If you don't have a mortgage, car loan or credit card, find a good card with a low APR and apply. Make monthly purchases such as groceries, and quickly pay the balance each month. It is only through consistent good management of credit that your credit score will go up.