Tips To Effectively Raise Credit Score
If you are of the many people suffering from bad credit, don’t worry about your bad credit rating. Instead, you have to work to raise your credit score. There are various steps to follow to raise credit score, where the first one is to get a free copy of the credit report.
You have to get a copy to ensure that the information on it is accurate. Inaccurate information can give you a bad credit score. Any errors have to be immediately informed to the three credit bureaus through dispute letters mentioning the said errors.
It is important that you pay your bills on time so that you raise credit score. Your payment history accounts for 35% of your credit score, where the latest payments you make carry maximum wait on your credit score. Even a single missed payment can lead to a decrease of your credit score by 50 to 100 points.
Work at reducing current debt
The next thing to do to raise credit score is to work at reducing your current debt as quickly and as much as possible. And if there is a large gap between the amount of debt your card carries and the card’s credit limit, your credit score tends to increase much more.
Though you may think that closing of old credit accounts help in raising your credit score, this is not so. This is because today’s credit scoring methods punish you when you close your accounts as it tends to reduce the distance between your credit limit and your debt. This thus reduces and not raises your credit score.
You can never raise your credit score by filing for bankruptcy as it only damages and at times, destroys your credit score. In fact, you will reduce your credit score by a minimum of 200 or more points which will be difficult to recover as bankruptcies remain on the credit report for a minimum of seven years.
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