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Suggestions from FICO to Improve Your Credit Score

By Michele Lerner
Mortgage Credit Problems Columnist


Dealing with credit problems ranks up there among the things people hate to think about, like going to the dentist or paying taxes. Individuals with credit problems sometimes choose to ignore the steps they can take to improve their credit score.

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When overwhelmed with debt problems or hassled by creditors, it can sometimes be easier to push these difficulties to the back of your mind or to hope for a windfall to solve the problems. But the satisfaction of improving your credit score and getting a handle on your bills can have a lasting impact on you and your family.

Tips for Credit Repair

While there are mortgages for bad credit available, you'll pay more than if you invest some time in improving your credit score. Depending on the level of your debt problems, following some simple suggestions from FICO--the company that generates credit scores--can have a big impact.

  • Pay your bills on time: The quickest way to repair your credit is making sure your payments are never late.
  • Make up missed payments: Bad credit can be improved by getting current.
  • Pay off a collection account: A collection pay off stays on your report for 7 years, but it's better to have it show up as paid and get the count-down to removal started.
  • Pay down your balance on credit cards: Creditors like to see low debt to credit ratios. Try to keep the balance lower than 30% of the limit.
  • Pay off debt: Instead of transferring debt from one card to the other, try to pay it off.
  • Unused credit accounts: Don't close any unused accounts or open new ones that you don't need.
  • New accounts: People with credit problems should avoid opening new accounts since credit scores are higher on older accounts.
  • Loan shopping: Are you looking for a mortgage for bad credit? You can shop by filling out the form on this site. Get a range of quotes to find the best deal for you.

If you are fixing past credit problems, your score won't improve over night. You'll need to re-establish your credit history. Open new accounts and pay them off promptly to improve your credit score over time.

Financial experts have lots of suggestions for ways to deal with bad credit, including working with bad credit lenders to find mortgages for people with poor credit to buy a home or refinance. You can quickly learn if you qualify for a loan by completing the short form on this

Sources

http://www.myfico.com

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