Some suggestions Scores reflect credit payment patterns over time with more emphasis on recent information. In general, a score may improve, if you:
- Pay your bills on time. Delinquent payments and collections can have a major negative impact on a score.
- Keep balances low on credit cards and other "revolving credit." High outstanding debt can affect a score.
- Apply for and open new credit accounts only as needed. Don't open accounts just to have a better credit mix it probably won't raise your score.
- Pay off debt rather than moving it around. Also, don't close unused cards as a short-term strategy to raise your score. Owing the same amount but having fewer open accounts may lower your score.
Review your credit report regularly so you know what is being reported. It won't affect your score to request and check your own credit report.
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Items that make scores better
Paying your bills on time is the single most important contributor to a good credit score. Even if the debt you owe is a small amount, it is crucial that you make payments on time. In addition, you should minimize outstanding debt, avoid overextending yourself and refrain from applying for credit needlessly.
Applications for credit show up as inquiries on your credit report, indicating to lenders that you may be taking on new debt. It may be to your advantage to use the credit you already have to prove your ongoing ability to manage credit responsibly.
If you do have negative information on your credit report, such as late payments, a public record item (e.g. bankruptcy), or too many inquiries, you may want to pay your bills and wait. Time is your ally in improving credit. There is no quick fix for bad credit.
One common question that many consumers have
regarding their credit score involves understanding how very specific actions will affect their credit score. For example, someone might ask if closing two of his/her installment accounts would improve his/her credit score. While this question may appear to be easy to answer, there are many factors to consider. A credit score is based entirely on the information found on an individual’s credit report.
Any change to the credit report could affect the individual’s scores. Simply closing two accounts not only lowers the number of open installment accounts (which generally will improve your score) but it also lowers the total number of all open accounts (which generally lowers your score). Furthermore, such an action will affect the average age of all accounts that could either raise or lower your score. As you can see, one seemingly simple change actually affects a large number of items on the credit report. Therefore, it is impossible to provide a completely accurate assessment of how one specific action will affect a person’s credit score. This is why the score factors are important. They identify what elements from your credit history are having the greatest impact so that you can take appropriate action.
How long does it take to rebuild scores?
Actually, you don’t rebuild scores. You rebuild your credit history, which is then reflected by credit scores. The length of time to rebuild your credit history after a negative change depends on the reason behind the change. Most negative changes in scores are due to the addition of a negative element to your credit report such as a delinquency or collection account. These new elements will continue to affect your scores until they reach a certain age. Delinquencies remain on your credit report for seven years. Most public record items remain on your credit report for seven years, although some bankruptcies may remain for 10 years and unpaid tax liens remain for 15 years. Inquiries remain on your report for two years.