If you have a low credit score you might find it difficult to get a home mortgage, a car loan or even credit cards. Luckily there are some simple things you can do to help you raise your score.
1Credit Card Reporting Date
One of the most effective, yet closely guarded credit score secrets is this: Your credit card issuer reports to the credit bureaus each month on a specific day. You can use this to your advantage. Contact the credit card issuer and ask the representative when they report to the bureaus.
If they do not know, you’ll need to speak with a manager. Once you know the date, you can begin making strategic payments. Pay your bill two days before the reporting date, and your new credit utilization will be reported.
2Never Cancel Cards
There’s a myth out there that says if you don’t use a credit card, you should close the account. That might be true if keeping a card open without a balance on it is a tremendous temptation to spend, but for most people, a credit card with an open balance is a good thing.
In fact, you should never, ever cancel credit cards. One of the most interesting credit score secrets is that any available credit is a good thing for your score. Every card you pay off, keep it. Make a couple of purchases per month with the card and then pay those off completely. This gives you a better debt to income ratio but also bumps up your credit score.
3A Balancing Act
Yet another in our list of important credit score secrets is that you can manipulate your card utilization to improve your score. You do this by leveraging different credit limits, which allows you to strategically adjust your balances so that it reflects best on your score.
For instance, if one card has a high utilization (debt vs. credit limit) and another has low utilization, shift some of your debt to the low utilization card. This allows you to spread your debt out between multiple cards and reduces your utilization of a high-balance card, thereby bumping up your credit score.
These are just three credit score secrets. There are plenty of other ways to bump your credit score up and make yourself a more attractive borrower. However, the best advice is still to use your credit responsibly and to manage it correctly.
That will naturally result in a higher credit score and a better financial standing. It’s always better to avoid damage in the first place than it is to repair your credit and try to improve your credit score.
Susan McCullah is an established writer who has created dozens of informative articles about credit scoring, identity theft, budgeting, taxes, debt, and finance. She has worked in the Credit Reporting industry for 15+ years and is FCRA certified. Susan regularly conducts in-person presentations and webinars on the topics of credit scoring formulation, raising credit scores, and identity theft.
