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Credit Repair Tips

Credit Repair Tips To Help Boost Your Score

It's a well-known fact that having healthy credit is essential to your overall financial health. Not only does the almighty credit report determine whether or not you'll get a loan or credit (and at what rate), it may also influence employment, insurance, and the ability to rent; among other factors. If your credit isn't in the best shape, here are some credit repair tips to help improve your scores.

Credit Repair Tips #1: Dispute inaccuracies on your credit report. There's a good chance your credit report contains errors. Some errors may be severe enough to prevent you from getting credit. Making sure everything is accurate, is one of the best credit repair tips you can perform today.

Credit Repair Tips #2: Maintain a good payment history. 'Payment history' makes up 35% of your credit score. The most important thing you can do in this area is to pay your bills on time every month. Even one late or missed payment could reduce your score by 100 points - ouch! Consistent, on-time payments month after month is one of the best credit repair tips that will drastically improve your credit score.

Credit Repair Tips #3: Keep your credit utilization rate low. 'Credit utilization' is the total amount of your debt compared to your available limit and makes up 30% of your credit score. The closer your outstanding debt is to your limit, the more your score will be damaged - especially if you max out your cards. One of the best credit repair tips is to pay down your debt and keep your balance at less than 50% of your limit. Maintaining 20%-30% of your available limit is even better.

Credit Repair Tips #4: Establish a good credit history. 'Length of credit history' (how long you've had a credit file) is worth 15% of your score. The older your file, usually, the better. While you are focusing on credit repair, one of the best tips here is to keep your accounts open - especially your oldest ones. Even if you don't use the accounts, don't close them or you will damage your length of history. Wait until your score is where you want it to be before closing any accounts.

Credit Repair Tips #5: Have a healthy mix of credit. 'Types of credit' makes up 10% of your score. Typically having at least two revolving accounts and one installment account is enough to boost your score in this area. It's good, and necessary, to have credit accounts; as long as you manage them responsibly.

Credit Repair Tips #6: Don't apply for too much new credit. 'New credit' comprises 10% of your score; which isn't much, but will still affect your overall rating. One of the best credit repair tips in this area is to apply for new credit only if it will help you achieve the healthy mix as discussed above.