Waiting For a Credit Score Change? – Raise Your Credit Score Fast and Improve Credit History
If you’re responsible with your credit, you should know the importance of keeping up to date with your credit score. Even if you make every payment and don’t exceed your limits, you should regularly be checking to ensure that your credit score is healthy (for reference, a good credit score is at least 670). It’s also imperative that you track any trends, or lack thereof when seeking a credit score change. You might not be doing anything wrong, yet find your score has stagnated. To raise credit score, you need to do some special tinkering that’ll give you the boost you need.
What is my credit score?
Simply put, your FICO credit score is a record of your credit history, condensed to a three digit number. It informs lenders of your credit history in as succinct of a way as possible. If you borrow money and pay it back on time, you’ll have a good credit score. If you borrow money and don’t pay it all back on time or ever, you’ll have a bad credit score. While the scores are more nuanced than just saying “good” or “bad,” anyone who uses a line of credit or lender should be aware of how imperative it is to pay back money on time.
I don’t have debts. Why is there no credit score change?
If you don’t have any debts, you should feel relieved, as most Americans wish they could be in your shoes. However, a good credit score isn’t just about not owing money. It’s also about proving you can be lent money and be relied on to pay it back. Are you asking yourself, “why hasn’t my credit score increased?” even after you paid off a $250 credit card bill in full? It’s because of actions like those, while responsible, are fairly small potatoes in the grand scheme of things. They certainly won’t hurt you, but they’re not going to ignite a credit score change. Be mindful of things that can ruin your credit.
A watched credit score never increases
While it’s imperative to check your credit score regularly, you can’t be expected to see a credit score change on an instantaneous basis. So if you just made a substantial payment, don’t immediately check and become crestfallen when you see your credit score has not changed. Additionally, it might take a few months for lenders to report any new relevant information regarding your credit score. It might be frustrating, but getting antsy won’t raise credit score.
Think of your credit score like it’s your body, and any action you taking is akin to making a health decision. If you are inactive and eat poorly, then five minutes of running and salad aren’t going to be enough to reverse many accumulated years of poor health. Similarly, making a payment on time when you have a longstanding history of missing them isn’t going to do much of anything for your credit score. To rebuild your credit history, you need to be consistent and work continuously to erase your debts. Make payments in a timely fashion to begin to see a credit score change.
You shouldn’t be a one-note borrower
Imagine you’re a lender at a bank. You have two customers who want to purchase a house. One has two credit cards with high limits that they’re a couple of months away from paying off, car payments they make regularly and student loans they recently paid off in full. The other has a single credit card with a $500 limit. Every month, they use it for groceries and then pay it off. Both have good credit scores, but which one is going to have the higher score and receive the loan? The one who has more forms of credit.
A credit score change isn’t going to happen if you come across as somebody who stays too close to their comfort zone. While the other person might have more outstanding debts, they’ve demonstrated that they can be trusted to pay back significant amounts of money. The second person has shown they can pay back money, but not to the extent of the one with more accounts on record.
This important factor can be more easily understood as your “credit mix.” While only ten percent of your credit score is comprised of this, that percentage can make a notable difference in your credit score. While you shouldn’t go overboard and introduce several new lines of credit at once, you should gradually bring in a new credit card that you know you’ll be able to use responsibly.
How Do I Improve My Credit Score Fast?
A credit score change comes with patience and discipline. While you can’t do anything short of time travel to improve credit history, you can take decisive actions to raise credit score. In fact, just a month of planning can make a difference. Here are some ways to raise your credit score in 30 days.
1. Keep up with your payments.
On time credit card payments isn’t something that will change credit score for the better in a flash. It will certainly help prevent any sudden plunges. Make sure that any payments you have are scheduled and completed in a timely fashion. Set credit card alerts on your phone or set up automatic payments, so you don’t have to worry about remembering. It will certainly help to improve credit history.
2. Mind your credit utilization.
Lines of credit, such as your credit cards, will have a limit. Your credit utilization is how much you’ve spent with that card versus how much has been made available to you. The comparative ratio should be no greater than 30 percent. If you find your credit utilization is higher than that, then develop a plan to bring your debt down.
3. Grow your credit limit.
A credit score change can occur through changing your credit utilization in a special way: increasing your overall credit limit. If you have proven yourself as a dependable credit user who makes their payments on time, you should be able to convince your credit card company to increase your limit. However, you shouldn’t see this as an opportunity to spend even more. Let your credit usage stay steady and enjoy the improved utilization. Having a credit utilization below 20% will be a great way to improve credit history.
4. Use loans and balance transfer credit cards.
To improve credit history, you can pay back your money in more convenient forms. With a balance transfer credit card, you can bring your outstanding to debt to another card with lower APR. Lower interest means you’ll be able to pay off your credit card fast and spend less in the process. You can also take out a loan with lower interest rates to influence a credit score change.
5. Prevent credit card accounts from closing.
While maxing out your credit is never a good idea, you also don’t want to ignore any of them either. If credit bureaus find you’re not making use of cards, then you’re not going to motivate them to boost your score. To improve credit history, you need to be a proactive credit user. Any credit cards should be used to at least some extent or banks close credit card accounts. The consistent use of credit will help with a credit score change for the better.
Improving your credit score is not an immediate process. You must understand the importance of paying off debts and having a broad range of proven financial responsibility. As you improve credit history, you can expect to see a credit score change and to feel proud of the efforts you’ve made.