Tips for improving your credit score

Dear Friends,

If you are staying in United States your credit score is very important it plays very important role in your financial life so i would like to share some information about how to improve credit score.. When i come to USA my couple of my friends told me that we need to have credit card to build the credit score (that is partially true) and we should not use full balance on our credit card to get better credit score. Let look into the some tips how you can improve your credit score.

Improve your payment history:

• Pay your bills on time. Delinquent payments have a major negative impact on your score.
• If you missed payments, get current and stay current. The longer you pay bills on time, the better your score. But even if you pay off a delinquent account, it stays on your report at least for 7 years. so try to be on time.

Recommendation: try to pay your bills online using auto Clarence system (also called ECS) Which will pay your bills automatically on the day which you scheduled so this will avoid paying late payments and bad credit history.

Lower the amounts your owe:

• Keep your balances low on credit cards and other revolving credits. High outstanding debt can affect a score. lot of people have myth in about this if we use credit card more we will build more credit history, this is not always true. We should not exceed 10% of our credit limit to build fast credit score. if your credit limit is very low you can apply for multiple cards to use the them and build credit score.
• Pay off debt. Don't just move it around. The best way to improve your score is by paying down your revolving credit. try to avoid balance transfer from one card to other card.
• Don't close unused credit cards to rise your score. Owing the same amount, but having fewer open account may lower your score.
• Don't open new credit cards your don't need. This approach could backfire and lower your score.

Establish your credit history slowly:

       

• Don't open a lot of new accounts too fast. If you've been managing credit for a short time, rapid account buildup can look risky.

Get new credit:

• Re-establish your credit history. Even if you'd had problems in the past, opening new accounts responsibly and paying them off on time will raise your score in the long term.

These are the few point which i recently came across while analyzing about credit scores, so i thought of share with you. if you have any relative or friends in USA whom you think this information is help full please pass it on to them. Please write your comments in the comments section so that we can improve. In next article we are writing about how your credit score is calculated.

We welcome your feedback and questions.