The credit standards that lenders use are becoming more and more restrictive. They are tracking credit scores more closely, and your credit rating is becoming a more integral part of your finances than ever before. If there are problems in your credit score, then it can really hold you back from getting a loan, or even getting employed.
According to the Federal Reserve, there are five keys ways to boost your credit score.
1. Obtain your credit report
By visiting AnnualCreditReport.com, you can get a free credit report once a year. You can get one free report from each of the three reporting bureaus, and you can also get one by calling 877-322-8228. Be sure to check over the report for errors once you get it.
2. Pay every bill in a timely manner
One of the key ways to improve your credit score is to pay all your bills by the date they are due. It can help to set up automatic payments using your bank account, but you do want to ensure that there is enough money there to cover your bills and avoid bank fees.
3. Know what comprises your credit score
Your credit score is determined by a few different factors:
- How well you pay your bills (on time and in full)
- How much debt you owe
- How long you have been using your credit
- Whether you have recently applied for credit
- How many types of accounts you have
4. Know what legal action can be used to boost your credit score
You can find information on improving your credit score directly from the Federal Trade Commission. This tells you how to find and fix errors and how to lodge a dispute.
5. Look out for scammers
According to the FTC, there are many companies out there that are looking to take advantage of people who have poor credit scores. They promise they will be able to help you improve your score, but many times they aren’t able to fulfill those promises using the tactics they employ. If you repair your credit on your own, you will have much more success.
Want help boosting your score?
Consult with our Credit Strategists for free.