Credit matters to everyone. Even if you pay cash for things or do not have a credit card, your credit history and credit score will come into play at some point in your lives. Landlords, mortgage companies and car dealerships check your credit. Even some employers check your credit, because whether or not you are fiscally responsible says a lot about your character. The better your credit, the less it will cost you to get various loans because you will be offered the best interest rates. In many cases it may be important to work on improving your credit.

Improving your credit, especially bad credit, is like trying to lose weight. It takes time and there is not a quick fix. Losing weight quickly can backfire because it is easy to put back on. Likewise, beware of quick-fix claims to improve your credit fast.

Improving Your Credit

Check Your Credit Report
Credit score repair begins with knowing exactly what is on your credit report. You can request a free copy of your credit report and check it for errors. If you find errors on any of your reports, dispute them with that credit bureau and reporting agency. Also there are some very reasonable services that monitor your credit and alert you if you have any changes. Ignorance is not bliss when it comes to managing your credit.

Paying Your Bills on Time
The payment history on each of your accounts is responsible for 35% of your credit score calculation. Paying each of your creditors on time is the simplest way to earn and keep a great credit history and score. Any late or delinquent payments will negatively impact your credit history and score. If you do not pay a debt month after month it will normally go to collections and can have a major negative impact on your score.

Reduce the Amount you owe on Your Credit Card(s)
If you have large balances on your credit cards you should stop using them. List out all of your credit card debts with the highest interest rate card listed first and descending after that. Focus on paying down the ones with the highest rates first. Once you get down the balances try to keep your monthly balances at a 15% ratio to the credit limit on the card. Contributing 35% to your score calculation, this category has the greatest effect on improving your score, but past problems like missed or late payments are not easily fixed.

Limit the Amount of Inquiries on Your Credit Report
Every time you open new credit, your credit report will be pulled and your score will be checked. Having too many inquiries on your report is a sign that you are financially strapped and consistently seeking out credit because you do not have enough funds. Too many inquiries can lower your credit scores.

Length of Credit History
It can be beneficial to keep your older credit cards open. This shows a strong credit history and a long relationship with the same company. Be careful whenever you close credit cards because typically this will lower your available credit limit and your utilization will go up.

Improving your credit may take a long time, but you can do it. The team at Numerico is ready to provide you with the financial guidance you need to achieve your goals.

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