Improve Credit Scores:
Here are a few reasons why it’s in your best interest to improve credit scores:
- Lower your interest rates, auto insurance
- Speed up credit approvals
- Reduce deposits required by utilities
- Get approved for apartments
- Get better credit offers, car loan, mortgage, etc.
- Pay on time. If you can’t, notify your lender ASAP and work something out
- Get current on past due accounts
- Keep balances low (35%) on credit cards. High debt levels can hurt your score and other “revolving credit.”
- Apply for and open new credit accounts only as needed.
Length of Credit:
- Keep old accounts open if you’ve been a good borrower.
- Start building credit ASAP.
New Credit Category:
- When shopping for new credit, keep it all within 14 days or less.
- If credit history is bad you can improve credit scores by opening a new account and managing it responsibly.
Types of Credit:
- Installment debt (fixed monthly payments to eliminate debt) is “better” than revolving debt (open-ended debt).
- Certain finance company debts (buying product with retailer financing) can lower your score.
Have patience, because it takes time and discipline to improve credit scores.
This series of articles from the Money Book by Jeff Burch will continue tomorrow with an article titled Big Credit Mistakes To Avoid.