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How To Raise Your Credit Score

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Things to do:
  • Pay your bills on time.  Every time you pay a bill 30 days late, it lowers your score.  The more recent the late payment is, the more that late payment lowers your score.
  • If you missed a payment, get current on that account.  If you are past due on an account, just making the late payment – and not making the current month’s payment – will continue to lower your score.
  • Keep balances low on credit cards.  
    — If your balance is more than 70% of your credit limit, it lowers your score the most.
    — If your balance is 50% – 70% of your credit limit, it lowers your score a bit less.
    — If your balance is 30% – 50% of your credit limit, it lowers your score even less.
    — If your balance is below 30% of your credit limit, it will improve your score.
  • If you don’t have any major credit cards (MasterCard, Visa, Discover), or only have one major credit card, you should open one (two is better).  The thing that raises your credit scores the most is having a history of using major credit cards wisely, so you need to have them and use them in order to have a good score.
  • Some lenders (including us) have credit analysis software.  It will tell you exactly what to do to raise your scores – it also tells you how many points your scores will go up.
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Things NOT to do:
  • Do not close accounts.  The longer your accounts are open, the higher your score will be.
  • Do not pay off old collection accounts or old charge off accounts.  Paying off an account that no one is actively trying to collect will change the “date of last activity” from the old date to the current date, and lower your score, even though it is now paid off.
  • NEVER pay anyone to “repair” your credit.  They are only ripping you off!  You can fix errors on your report by yourself – for free. Use a lender who will show you how, and who will help you – for free. smith roxbury sold 027
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