Tuesday, April 16, 2013

Warning: Following this Advice Will Vastly Increase your Credit Score Rating!

This is a guest post by Ethel Wilson. Short bio is included at the bottom.

Warning: Following this Advice Will Vastly Increase your Credit Score Rating!

You’ll find many so-called experts on the internet claiming they can boost your credit score rating – for a fee of course. The last thing you need to do if your credit rating is low is to spend more money! The methods these companies and individuals use don’t always work either. Many of their methods are short term fixes designed to cheat the system. Like any shortcut there is risk involved, and these “fixes” often come back to haunt you in the long run. You can repair a damaged credit rating yourself; it’s neither difficult, nor complicated. It does take a bit of discipline and a little time (not as much as you might think), but the following methods have been proven to greatly increase your credit score rating. 

Pay your Most Recent Past-Dues: The very first thing you should do is to pay all past due payments on your accounts that most recently fell a month or so behind. The reason for this is that; the more recent a late payment, the more dramatically it will lower your credit score rating.

Apply for a Credit Report Adjustment: Once you have brought you past due accounts up to date, your next move is to contact the creditors who are responsible for reporting late payments regarding your credit score rating. Request that they make a good faith adjustment to delete the late payment information from your credit history files. Not all creditors will cooperate, but asking politely and reminding them that you will continue to be a valued customer, may convince a few to work with you.

Pay Collections Agencies that Will Wipe the Slate Clean: If you have any accounts in collection, pay those off where the collection agency will agree to delete any references to those accounts from your credit history. It is important that you make it clear from the outset that it is a condition of paying off the debt in full. You’ll be surprised how many agencies will cooperate just to clear the account from their books. This strategy can raise your credit score rating drastically in only a few months.

Spread Debt Around: It’s better to have several cards with mediocre balances than to have one or two with a zero balances and another with a very high balance or completely maxed out. Try to spread the debt around so that none of your cards has a balance of more than 40% of your limit. An effective and fast way of raising your credit score rating is to ask the creditor to increase your limit, thus lowering the percentage of your balance. Keep in mind however that you must maintain that ratio going forward to maintain the points you earned by doing so.

Make Sure Your Credit Limit is Reported: If your creditor does not inform the credit bureau of your accounts limits, this negatively affects your credit score rating. The reason for this is that because no limit is mentioned, the system the credit bureau uses to calculate credit scores assumes the account to be maxed out. Your credit score rating could be suffering simply because a creditor has failed to notify the credit bureau of your limit, not through any fault of your own. You could have a lower score than you deserve, so this step is well worth taking.

Apply for a Credit Card from a Major Bank: Of course the best way to improve your credit score rating is to maintain a good credit history over time with a major bank. This is especially true of credit cards issued by them. If you don’t have one, get rid of all of those department and retail store cards that do little to help, and much to harm your credit score rating. They have a much higher debt to limit ratio, and consequently affect your score adversely. Qualifying for a credit card issued by a major bank automatically increases your credit score rating dramatically.

Ethel Wilson is a financial and credit specialist with 12 years experience in the banking, credit scores, and financial industry.  She has advised countless clients on how to improve their credit score rating.  She shares the best of her credit score information as a contributor and editor of http://www.creditscoreresource.com

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