Improving a credit report begins with understanding the factors that look good on a report and the potential problems that are dragging the credit rating down. It is not always necessary to take drastic measures to repair a credit report when a few simple steps can have a dramatic impact.
Pay Bills on Time
Roughly 35 percent of a credit score is directly related to the current payment history. The best way to start working on rebuilding personal credit and improving the report is by paying all of the bills and debts on time each month.
If a missed payment has occurred, then pay both the missed payment and the current payment. It will have an impact on the credit report over time. The best way to make sure you are paying bills on time is by staying organized. By writing down dates on a calendar or using phone apps to alert you of payments you can be more sure you will be taking care of your bills on time.
Read the Report and Dispute Errors
Although errors may not occur on a regular basis, it is possible for the credit reporting agencies to have inaccurate information. Problems associated with accidental mix-ups, creditors who inaccurately report payments or similar situations might arise. Even a computer glitch can cause a mistake on a credit report.
If an error is spotted, then raise a dispute. The reporting agencies will investigate and make appropriate changes within 30 days.
Leave Credit Open
Do not close credit cards just because they are not in use. Having a high amount of available credit with a low balance can have a positive impact on a credit rating. Long-term credit also has a positive impact, so it is important to keep accounts open if it is a revolving account.
While it is important to keep accounts open, focus on larger accounts rather than small ones. A limited number of cards with a high available credit are better than several cards with a small available credit.
Work on Debts
Getting rid of your debts will be one of the biggest ways to improve your credit report. The only way to do this is to pay more into debts than the minimum balance. To keep organized make a goal to pay off one at a time so you are not overwhelmed by all your debts. Once you pay one off you will feel great and be more motivated to start paying off the next one. Paying back debts can have a positive impact on a credit rating. Paying only the minimum balance is not enough to improve a credit rating.
Get Help from Professionals
Professional assistance, like the help available at http://www.lexingtonlaw.com/info/testimonials.html, is an appropriate solution when it seems impossible to improve the credit rating. A professional can identify problem areas and provide personalized actions plans based on the situation.
Improving a credit report may seem challenging, but it is possible with persistence and planning. By taking steps to improve the report, the overall credit score will improve and creditors will be willing to offer better loan options.
Category: Credit Score