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Tips to Increase Your FICO Score

By George Hauser
Published: Friday, November 27th, 2009

Many consumers who have credit sometimes forget about the importance of their credit score. True enough, credit score tips tell you to read about credit report and credit score before you make credit and loan applications. The credit report should be regarded as one of the most valuable documents by any consumer who has already started building credit, and those who are just planning to. 

Your credit report contains information about your credit activity, from payments to the number of accounts you have, to reports from your creditors and lenders. This is valuable because your future creditors will have to refer to it when they make their minds up about your applications. 

The data on your credit report is then transformed into a three digit number. Credit bureaus apply different scoring models. They use a computer software and a secret formula to make a credit score out of the contents of your credit report. Because of the credibility of credit bureaus, most creditors would only go as far as checking your credit score. If you have low credit score, you applications could be denied. 

That’s why most credit score tips are useful in the sense that they remind consumer credit holders to check their credit reports regularly. This way, they can understand what contributes to the decrease in their credit score. Other than that, they can also review their reports for inaccuracies and other erroneous reports. One of the most common credit score tips suggest that you should know the proper process of filing disputes against the errors in your credit report. Such will increase your credit score. 

Apart from there credit score tips, here are some practical ways to increase your credit score, particularly FICO score. 

Go with high limits

When you are new in the world of credit and you are applying fir a credit card. One of the things you should remember according to credit score tips is to choose an application that offers high credit limit. To avoid having delinquencies on your credit report which reduce your credit report, you should not charge over the limit because there are additional costs when this happens. 

Find a co-signer

A co-signer can help you rebuild your credit score. Having a co-signer means that both you should be able to meet the financial requirements in starting a credit application. If you wisely choose a co-signer, you can take advantage of his or her good credit standing. A co-signer’s high credit score can pull yours too. 

Be assertive and observant

One of the benefits of reviewing your credit report on a regular basis and at the same time being aware of your own financial activity is a higher chance at determining errors. Mistakes in your report are not something uncommon. When you find one, you should follow the proper procedure in filing for disputes. This way, you can increase your credit score by cleaning your credit report from errors. 

Not too much revolving credit

True enough, many people prefer using credit cards over loans. This could be because of the convenience revolving credit offer. However, if you can not manage your credit card expenses, your credit score could greatly suffer. Still, if you can’t help but use your credit card, you should see to it that their balances are low.

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