Whenever you apply for a loan or credit card, the lender pulls your credit report and credit score to help them decide how big a risk they’re taking if they decide to loan you money. A higher credit score benefits you because it usually means a lower interest rate and more reasonable payments. If you’ve had credit problems and your score isn’t where you’d like it to be, you may wish to bring your score up quickly. A question we hear from time to time is “How can I raise my credit score by 200 points in a month?”
Building Better Habits
In most cases, improving your credit score isn’t something that’s going to happen overnight. Your credit score is made up of a combination of factors, and there are several things that you should work on if you’re hoping to bring up your credit score. Things that can help to improve your credit score include:
- Always pay on time. Probably the most important factor that goes into your credit score is your history of making payments on time. If you have been in the habit of not worrying about due dates, it’s time to change that habit. Always pay on or before the due date to avoid causing damage to your credit.
- Catch up on past-due payments. If you have one or more accounts that are currently past due, you should make it a priority to bring your accounts up to date. The sooner all accounts are current, the sooner you’ll see an improvement in your credit score.
- Avoid overborrowing. Another factor that has a big impact on your credit score is your credit utilization. This means the percent of available credit that you’re using on revolving accounts such as credit cards. Experts usually recommend using no more than 30 percent of your available credit. If you have maxed out your credit cards, pay down the balance as soon as you can and avoid borrowing more.
- Lower your credit utilization. Another way to improve your credit utilization is to increase the amount of available credit you have. You can request an increase of a current credit line or open a new revolving account that you avoid borrowing against.
If you’re building your credit from scratch or rebuilding after credit missteps, start with a secured credit card. Your credit line will be based on money that’s deposited and held in a savings account as security. As you establish a pattern of on-time payments, your credit score should increase. Another option to help improve bad credit is a credit builder loan.
Look for Errors in Your Credit Reports
If there is inaccurate information on your credit reports, it could bring down your credit score and once it’s removed, your credit score may go up quickly. Review your credit report carefully and dispute any inaccuracies that you find.
Dovly is an AI credit engine that can help you dispute any errors you find on your credit report. Try it risk-free with our free membership tier. Get in touch with Dovly today.
