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3 Semi-Easy Ways to Boost Your Credit Score (and Get a Free Credit Check)

by Shawanda Greene

Earlier this week, I tweeted the following:

Getting a car lease

Surprisingly, many of my Twitter friends chimed in to share their opinion on which is a smarter option: buying or leasing a car.

One Twitter follower asked me if I financed or paid cash for my vehicle. Completely unembarrassed by hypocrisy, I replied,

I financed my vehicle

Clearly my position on borrowing money has shifted a bit. Two years ago, I would’ve ended my answer with “before I knew better.”

No buts.

No qualifying statements.

Y’all know me. Debt freedom is worth far more than a depreciating asset I can’t afford. Heck, I struggle with taking out a mortgage to buy a modest home.

But that’s just me.

If you insist on taking out a loan, for any reason, you’ll need excellent credit to secure the best interest rates.

I’d rather you cut yourself with the sterile edge of a sheet of paper than the rusty blade of a machete. So, I threw together a mini crash course on how to increase your credit score.

Obtain a copy of your Equifax, Experian, and TransUnion credit reports.

Although you can run a free credit check through AnnualCreditReport.com once a year for each major credit reporting agency, you won’t receive a score. With that said, the service won’t cost you a dime.

Inspect each credit report for incorrect information.

Is your student loan categorized as a revolving account? Is the real age of your home equity line of credit older than what’s shown on your credit report? Is a credit card limit higher than what’s recorded?

Do you see accounts that don’t belong to you? Late payments that were paid on time? Applications for credit you didn’t make?

My apologies for slapping you with a litany of questions, but this stuff matters.

Dispute inaccurate information with the applicable credit bureau and the knucklehead who provided it, immediately.

Decrease your credit utilization ratio below 10%

Simply put, your credit utilization ratio is how much credit you’re using compared to your total available credit.

There’s a rumor floating around that cancelling credit cards improves your credit score. Balderdash! It ain’t true!

Close a revolving line of credit and you risk harming your credit score in two ways:

1) You shorten the average age of your credit accounts.

2) You increase your credit utilization ratio.

Leave zero balance revolving accounts open, and pay down the outstanding amount on the others.

Many creditors report card balances as of the statement date. Meaning, even if you pay off your balance after the statement date and before the due date, your utilization ratio may seem unreasonably high.

So, submit your payment before the statement date. 

If you can’t pay your revolving accounts in full each month, then why are you going deeper into debt, huh?! Stop this foolishness now before you render yourself insolvent.

You could also request a credit limit increase on your existing accounts. Ask the representative at your credit issuer whether a “hard pull” or “hard inquiry” is required to get a higher limit.

Keep your credit shopping period short, say, 14 days or less.

For instance, many scoring models count applications for new credit within a small window as one hard inquiry. In case you’re wondering why this matters, creditors get a bit squeamish when your behavior suggests you desperately need a loan.

If you look like you’re a prudent consumer hunting for the best interest rate, the damage to your credit score is minimal.

What tricks have you used to quickly boost your credit score?

Did you enjoy this article?
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{ 2 comments… read them below or add one }

Kelly@FinancialFixers October 5, 2012 at 11:14 AM

I was lucky enough to have a mother who is pretty money savvy and thought about helping me build my credit. When I moved away for school, she helped me open a credit card that I would use for grocery shopping and small stuff. This allowed me to build good credit along with her and eventually get a good deal on a car lease when I graduated.
Kelly@FinancialFixers recently posted..The Real Costs of Running a Blog BusinessMy Profile

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Christine@FinancialFreedom October 8, 2012 at 10:30 AM

This article was very insightful. I on the other hand purchased my vehicle with a low interest rate due to my credit which is amazing. I wanted to point out another key thing that stuck out to me which was when you said, “submit your payment before the statement date”. This is very important because it can make or break your credit score especially if you keep making late payments.
Christine@FinancialFreedom recently posted..10 Biggest Money Mistakes Even Smart People MakeMy Profile

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