7 Hacks for a Better Credit Score

Are you interested in turning your credit around this new year? There are simple things that you can do today to raise your credit score and improve your financial standing. Follow the tips below for better credit right now!

  1. Sign up for a new credit card.

This adds positive information to your credit report. Apply for a credit card targeted to people with bad credit or go after a secured credit card. Just be responsible for handling this new plastic!

  1. Open a credit builder loan.

Go to a credit union near you and ask about a credit builder loan. What you borrow is stashed on a savings account and serves as loan collateral. You still make monthly payments, which are reported to the credit bureaus. When the loan is paid in full, you keep the money, plus interest.

  1. Lower your credit utilization.

The closer your balances are to your credit limit, the worse it is for your credit score. If you have available money, use it to pay down your balances. Aim for below 30% to keep your credit utilization at a healthy level.

  1. Talk to your creditors.

If you have negative accounts that have already been paid, ask the creditor to remove the account as a matter of goodwill.

  1. Go for the ‘pay for delete’ option.

Ask your creditor if it will be possible to delete a past due balance if you can pay the amount in full. If the account is still open, it may be re-aged by your creditor, too. Ask politely and explain your situation. You are asking a favor so be humble about it.

  1. Pay on time.

Ideally, you will pay your balances in full every month. If this is not possible, pay at least the minimum on all your accounts. Any past due balance can ruin your credit if it is reported to the credit bureau. Delinquencies can hurt your credit score a lot.

  1. Request for debt validation.

After the first call or letter, you can ask debt collectors to verify your debts within 30 days. The collection agency cannot add the debt on your credit report until the validation is done. This is only a temporary fix. The debt goes on your report after validation so makes sure you settle it to avoid damaging your credit score.