The Quickest Way to Get Your Credit Score Up

Having a low credit score will affect your ability to obtain credit cards, car loans and home mortgages. Employers and landlords check credit scores to find out if you are financially responsible. Low credit scores are a result of paying bills late, home foreclosure, bankruptcy, overextended credit cards or other financial problems that have occurred. Credit scores range from 300 to 850. A good score is 740 or above. You can get your credit score up relatively quickly.

Instructions

1

Check your credit card report for free once a year from each of the major credit bureaus; Equifax, TransUnion and Experian. Get a free credit report online from these companies at www.AnnualCreditReport.com or call 877-322-8228. These companies will supply a free credit history, but they may charge a small fee for you to obtain your credit score. Check your score and credit history. Read carefully all of the information on the report. Dispute any errors that you find and fix them by sending a letter to the credit reporting bureau.

2

Pay all of your bills on time. Set up automatic payment plans so you do not miss a payment. Utility companies and phone companies report late payments to the credit card bureaus.

3

Pay down any revolving credit card balances that you have. Start with the cards that are close to their credit limit.

4

Avoid having large balances on your cards, even if you pay them off each month. Keep the amount of purchases made to a credit card to 25 percent to 30 percent of the cards available limit. Ask to have the credit limit raised if you are always near the limit. That will make it look like you are not maxing out your card each month.

5

Create a longer credit history by using your oldest cards every month. Place small amounts of credit purchases on your cards each month.

6

Reduce the amount of your balance that is seen by the credit bureaus. Pay your balance or monthly payment before it is due so that your statement looks smaller when it is reported.

7

Limit the amount of new credit cards you open. Do not apply for credit cards that you do not need. Avoid opening new credit cards at department stores. Do not close out old credit card accounts. This makes your credit history look shorter and the credit limit smaller.

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How to Clean Up Credit Fast

Cleaning up your credit can provide a sense of accomplishment. Most people don't want to deal with bad credit. A low score can result in credit denials, with it becoming impossible to find a good rate and terms on finance packages. A better credit score is realistic. But before you can clean up your rating, you need to know what affects credit scoring.

Instructions

1

Work with creditors to remove wrong information from your credit report. Check your credit report once or twice a year. Make a note of incorrect information, and call your creditors to correct the inaccuracies. Removing errors can quickly clean up your credit.

2

Organize your debts. Place all your monthly statements inside a file folder, and make a notation of your due dates to avoid missing a payment. If you miss a payment, ask your credit card company to forgive the lateness to help clean up your credit.

3

Pay early. Don't wait until your due date to make payments. If you have the money, pay within a day or two of receiving the statement to improve your credit rating.

4

Use any extra money to pay down credit card balances. Rather than using extra cash to dine out, shop or vacation, make personal sacrifices and put that money toward your outstanding debts. Eliminating or lowering your debts helps improve your credit faster.

5

Address old accounts. Paying collection and judgment accounts, and asking creditors to delete this information from your credit report, can quickly raise your score.

6

Utilize rapid rescoring. It takes time for credit reports to reflect corrected errors and paidoff accounts. With rapid rescoring, creditors immediately update your report, and your credit score can increase within days. There's a fee for quick rescoring (about $50).

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Reasons to Dispute Credit

The three major credit bureaus (Transunion, Experian, and Equifax) maintain consumer credit reports containing information on a person's outstanding accounts, her bill payment history, employment, certain court judgments and a variety of demographic information. Sometimes these reports can contain erroneous information. This can happen for a variety of reasons, from identity theft to a simple clerical error. Whatever the cause of the problem, an issue on your credit report can still have a negative impact on your credit rating. Fortunately you can file a dispute to get the information removed. Disputes are typically filed for a variety of reasons.

Identity Theft

When you are the victim of identity theft, the thief will often open as many credit cards and other accounts as possible in your name. Your credit rating will be hurt when he doesn't pay the bills because the delinquencies will show up on your credit reports. If your identity is ever stolen, you should monitor all three credit reports and dispute incorrect items immediately. Be prepared to send police reports and other documentation to back up the dispute. You should also place a fraud alert on your reports, and you may wish to temporarily freeze your credit to make sure the thief cannot open any more fraudulent accounts.

Divorce

Your divorce decree may spell out the bills for which you and your former spouse each take responsibility, but that doesn't always keep your ex-spouse's accounts from staying on your credit report. If his credit cards and other accounts are showing up on your credit report, you can file a dispute and use your divorce decree as documentation. This will prevent his late or unpaid accounts from bringing down your credit rating.

Errors

Credit bureaus are not infallible. They often make errors, reporting accounts on your credit report that do not belong to you or including erroneous information. Some of that information, such as late payments or judgments, can bring down your credit score if it is not removed. Under the law, you are entitled to get a free copy of your credit report from each of the three major bureaus so you can review it for these errors. Review it annually and file a dispute on any incorrect items. The bureaus must remove them if they cannot be verified.

Outdated Information

Even if you have negative information on your credit report that really belongs to you, it can only be reported for a certain length of time. This varies based on the type of information and your state of residence, but items like bankruptcies and foreclosures typically must be removed after seven to ten years. If you have these types of items on your credit reports and the reporting period has ended, dispute the items and demand that they be taken off your records. This can give your credit score a significant boost.

Uncertainty

Sometimes you may just feel that information is not quite accurate or that the company reporting it will not be able to back it up or will not bother to respond to the dispute. If they do not respond to the credit bureau's inquiry or offer any proof, the item will be permanently removed. If you are reasonably certain this will happen, you can file a dispute on the information.

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How to Clear a Delinquency

When you are unable to pay your credit card bills, or any other bills, your account goes into a delinquent state. Delinquency will lower your credit score and may affect your ability to obtain loans. If you do not clear a delinquency from your account within a specified time period set forth by the creditor, your account may be sent to a collection agency.

Instructions

1

Pay off your delinquent account(s). This is the first step in removing a delinquent account from your credit report. If you are unsure of the past-due amount, contact the customer service department of the company you owe. If you do not have the money to pay off the past-due amount in full, ask for a payment plan. Most companies are willing to work with customers who wish to pay off a debt. Lenders prefer to have the debtor pay off the owed amount without handing the account over to collections, as a collection agency only pays them a small percentage of the total debt owed.

2

Write a letter of goodwill to the lender, or creditor, requesting the company remove the delinquency from your credit report once the outstanding balance has been paid off. In the letter, explain the circumstances that caused you to become late on payments and that you have paid off your overdue balance. The lender may act upon this request and manually remove the delinquency from your credit report.

3

If your account is in collections, contact the collection agency to arrange a payment plan to pay off the delinquent amount in return for the delinquency being removed from your credit report. Most collection agencies will agree to this proposal, as long as you are able to pay off the account. In some cases, you may be able to negotiate the total amount owed down from the original balance.

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How to Obtain a Free Credit Profile Number

The three major credit reporting agencies in the United States -- TransUnion, Equifax and Experian -- put credit profile numbers on each credit report you request from the companies. This number is used to reference accounts and other report information, especially if you are disputing a credit account with one of the reporting agencies. A credit profile number is not your credit score. Instead, it's an internal number that the credit reporting agencies use in order to reference the specific credit report you pulled. You can request a free credit report once per year if you need to get a credit profile number.

Instructions

1

Start your Web browser and go to annualcreditreport.com. Annual Credit Report is a central site run by Experian, Equifax and TransUnion that provides you with the free annual credit report you are entitled to by law from each credit reporting agency.

2

Use the drop down menu to select your state and click "Request Report."

3

Enter your personal information, such as your name and social security number, into the provided field. You also need your addresses from the past two years for identity verification.

4

Click "Continue." Put a check in the box next to the three credit reporting agencies on this page, unless you only wish to check a specific credit report. Click "Next" two times to land on the first credit report. The credit report number is listed in the personal information section on the report, next to your name, address and any previous addresses. The credit profile number is all numbers, and should be labeled as your report number. Choose "Next" to continue on to the next report and credit profile number.

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How to Rebuild Credit After Bankrutpcy

Facing financial turmoil, many consumers turn to bankruptcy to get control of their finances. After filing bankruptcy, you might feel like it's impossible to rebuild credit. According to Smart Money, however, the damage to your credit report might not be as bad as you think. Focusing on the areas that make the largest impact on your credit score will get you on track to rebuilding credit.

Instructions

1

Apply for secured credit. According to MSN Money, you have to use credit to build credit. The problem with bankruptcy, however, is lenders may be reluctant to extend credit. A secured credit card, which is offered by most credit card companies, is the solution. You will need to put down a deposit. However, after 18 to 24 months the company may convert the account to an unsecured card.

2

Review your credit report. After bankruptcy is finalized, accounts that show as overdue on your credit report should be labeled as "included in bankruptcy." If this doesn't happen, your credit score can take a hit. If you find accounts that aren't labeled correctly, contact the reporting bureau. Complete a dispute form and include copies of your bankruptcy papers.

3

Use credit cards for the purpose of rebuilding credit. High credit balances have a negative impact on your credit rating. Use your secured credit card to build credit, and pay off the card each month.

4

Secure an installment loan. Credit bureaus like to see consumers using both revolving credit (credit cards or home equity lines) and installment credit (like auto loans or personal loans). Consider applying for a small personal loan and pay back the loan quickly.

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Is It Legal for a Bank to Remove a Derogatory Item From a Credit Report?

Customers who delve into the specifics of credit reporting probably know that lenders, such as banks, control the majority of the information reported by the major credit agencies. This also means banks can remove negative items at will. Banks and other lenders are unlikely to remove negative items out of the kindness of their heart, but it is possible.

Identification

Banks can legally remove a negative item, but the credit bureaus probably do not support this action if the negative is legitimate. However, a bank might change a late payment to "paid as agreed" for a valued customer who has a long history with the company. Customers should not expect this because you never know when or which bank will agree to this.

Considerations

Removing a derogatory item or account from a credit report is a common tactic used by attorneys when negotiating a debt settlement. Most consumers pay less than the original balance when the creditor agrees to a debt settlement, but offering to pay the full balance in return for deleting the delinquent account could entice the lender. Again, this is never a guarantee, and such a tactic might backfire. Dangling a full payment lets the lender know that the consumer has the resources to pay the balance, which the creditor might recover through a lawsuit.

Late Fee vs. Derogatory Report

Lending institutions sometimes give customers a gift they might not notice. This often happens when a customer pays his bill a month late, but the creditor reports the account as never late. Instead, the creditor charges a late fee. Customers should never assume that banks will do this, even if the bank "forgot" to report a late payment in the past.

Tip

The only way to guarantee that a bank removes a negative item is when it makes an error in an update. Federal law requires credit bureaus and creditors to report accurate information and investigate any claim by the consumer of a mistake. The first step to disputing a mistake is using an online form from one of the agencies or sending a certified letter stating the error and a request to correct it, along with identifying information and copies of documents to prove your case. You could go to the bank itself and give it the same dispute package.

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