Learn How to Improve Your FICO Score
If you would like to learn how to improve your credit score, then you will want to read this article.
Specifically, we will be discussing three strategies that you can implement to improve your score.
After reading this article, you should have a good idea of some things that you can implement with your own credit file.
Play the Dispute Game Under the Fair Credit Reporting Act, both the credit bureaus and information providers (creditors) must investigate any dispute you make with regards to your credit file.
How does this work? Upon receiving your dispute, the three credit bureaus will immediately notify your creditor.
Your creditors have just 30 days to respond to the credit bureaus.
The credit bureaus must delete information from your credit file that creditors fail to verify within 30 days.
This must happen even if the information is actually correct.
Pay Down Revolving Debt The most successful credit repair efforts involve paying off revolving debt.
If you have a high level of debt, there is most likely no other single strategy that you can implement that will have more impact than paying off debt.
What you want to do first is pay down each account to 25% of your total credit limit.
You should not pay off any account in full until each of your accounts are down below 25% of your credit limit.
If you want to have the best possible credit score, you should make an effort to always keep your accounts below the 25% mark.
One thing to keep in mind is that you never want to close accounts once they are paid off.
Closing accounts lowers the total credit that you have available to you and therefore increases your credit utilization ratio.
Instead, just cut up the cards when you pay accounts off.
That way, you aren't tempted to use them again but still have the benefit of the available credit for credit scoring purposes.
Piggyback Many people believe that FICO 08 put an end to piggybacking.
The truth is that it merely regulated how piggybacking is done.
The reason for the changes is that unscrupulous credit repair companies were having people pay strangers to be added to their credit cards.
While you can still benefit from piggybacking on someone else's credit, the new guidelines restrict those that can help you out.
You can now only benefit from piggybacking off of a parent or spouse.
If you have a parent or spouse with an older account that has a great credit history and low balance, this is still a great way to improve your credit score!
Specifically, we will be discussing three strategies that you can implement to improve your score.
After reading this article, you should have a good idea of some things that you can implement with your own credit file.
Play the Dispute Game Under the Fair Credit Reporting Act, both the credit bureaus and information providers (creditors) must investigate any dispute you make with regards to your credit file.
How does this work? Upon receiving your dispute, the three credit bureaus will immediately notify your creditor.
Your creditors have just 30 days to respond to the credit bureaus.
The credit bureaus must delete information from your credit file that creditors fail to verify within 30 days.
This must happen even if the information is actually correct.
Pay Down Revolving Debt The most successful credit repair efforts involve paying off revolving debt.
If you have a high level of debt, there is most likely no other single strategy that you can implement that will have more impact than paying off debt.
What you want to do first is pay down each account to 25% of your total credit limit.
You should not pay off any account in full until each of your accounts are down below 25% of your credit limit.
If you want to have the best possible credit score, you should make an effort to always keep your accounts below the 25% mark.
One thing to keep in mind is that you never want to close accounts once they are paid off.
Closing accounts lowers the total credit that you have available to you and therefore increases your credit utilization ratio.
Instead, just cut up the cards when you pay accounts off.
That way, you aren't tempted to use them again but still have the benefit of the available credit for credit scoring purposes.
Piggyback Many people believe that FICO 08 put an end to piggybacking.
The truth is that it merely regulated how piggybacking is done.
The reason for the changes is that unscrupulous credit repair companies were having people pay strangers to be added to their credit cards.
While you can still benefit from piggybacking on someone else's credit, the new guidelines restrict those that can help you out.
You can now only benefit from piggybacking off of a parent or spouse.
If you have a parent or spouse with an older account that has a great credit history and low balance, this is still a great way to improve your credit score!
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