If you’ve read our post on The 6 Factors That Go Into Your Credit Score you know the baseline reasoning for why your credit is where it is. But there are a few things that credit elite do (aka those with a credit score of 850 or more) that you may not be doing. And these simple tips and tricks may be enough to move you from fair to good, good to excellent or even excellent to elite. It’s a lot simpler than you may think.
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1. Set all your bills on auto-pay
This may seem like a no-brainer, but never missing an on-time payment can do wonders for your credit. After all, it is the #1 factor that influences your credit score. Even if making the minimum payment on-time every month doesn’t do much for your revolving balance, the benefits to your credit score itself are invaluable. And we all know that some months we are not as on top of as others, so having that fallback security and not to mention – peace of mind – knowing that you’ll never miss a payment is a really wise move.
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2. Pay your credit card bills at least twice a month
Most members in the credit elite pay their credit card bills at least twice a month. Why? To keep their credit utilization ratios low. While creditors recommend a utilization ratio of less than 30% to keep your scores high and dry, most members of the credit elite keep it to a whopping 10% or lower. And of course, this doesn’t mean only making small purchases on your credit card accounts. It just means paying off the bigger purchases before it hits your monthly statement and subsequently, your credit score. Paying off your balances at least twice a month helps ensure your utilization ratio stays low. The credit elite typically do this weekly.
3. Request credit limit increases
If you have accounts that are in good-standing and have been open for a decent amount of time, most creditors will honor your request for credit limit increases. This is usually an option for accounts that have been open for 6 months or more and have few to no late payments. Similar to paying your bills multiple times per month, increasing your credit limits also work to help you improve (aka decrease) your credit utilization ratio. But remember, this is for the sole purpose of increasing your credit score – not being able to spend more money. If that is a temptation for you, it may be wise to avoid this option until you feel like your desire to spend is in check.
4. Review your credit report for errors
The Federal Trade Commission says that about 5% of consumers have errors on their credit reports that result in higher interest rates and payments for financial products and services. Additionally, 1 in 4 credit reports have errors that result in a negative impact on the scores themselves. This is enough of a chance to make anyone want to scrutinize his report for errors.
Common errors include the following:
- Payments marked late that were actually on-time
- Derogatory marks extending beyond 7 years time (aka too old to be listed)
- Accounts listed as yours that don’t belong to you
- Hard credit checks you didn’t request or weren’t meant for you
Fixing these and other similar errors by disputing them with the credit bureaus can show improvement to scores in as quickly as a few months. Credit Bureau’s are required by law to respond to any disputes within 30 days. So once the errors are rectified, your scores should improve almost instantly.
You’re allowed one free credit report per year from each of the three major credit reporting agencies. But the easiest way to get on top of previous errors is to use your free tools and get advice from the pros who do this for a living. CreditRepair.com offers a free 10-minute phone call to evaluate your credit for those who sign up online. You can ask the big questions, discuss the complicated stuff and lay the groundwork for building your own credit repair plan. During this phone call they offer you:
- FREE customized credit analysis
- FREE access to your credit score
- FREE credit report audit on all your accounts
- FREE score evaluation and recommended solution
Then, if you choose to utilize their paid services, they walk you through the entire process so you come out smelling like roses on the other end. How does it work? Well, when you sign up they pull your credit reports and organize it in a way that makes sense to us laypeople and identifies actionable steps to improve your credit score and report. They interact directly with the credit companies and bureaus to make sure your score and report is the most accurate and beneficial depiction of your financial situation and obligations. Throughout this whole process you have access to your personalized dashboard, score tracker and analysis and everything you need to monitor your progress in your credit repair journey. Previous members have seen an average increase of 40 points in 4 months.
5. Continue to monitor your credit for any future errors
Once you’ve gotten all the past errors cleared up, it’s easy to keep on top of any future errors that may occur. Using a paid credit monitoring service is one option, but most banks and credit agencies like Wells Fargo & Discover provide a monthly updated score for free if you’re already on their platform. Mint.com also has a free basic credit monitoring service for those who use their platform as well. Monthly credit monitoring can tell you if something negative has appeared on your report, in which case you’d need to pull that report and take it up with the respective agency.
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