Let’s take a look at how to improve
your personal credit. First and foremost, improving your credit takes
time and effort – there is no simple quick fix. You have to develop
consistent financial responsibility over time. With that said, here
are a few steps you can take in that direction:
1.
Pay your bills on time: Develop a habit of consistently paying your bills by
the due date. The longer you pay your bills on time without ever falling
late, the better your score.
2.
If you’ve missed payments, get and stay current: If you have late payments,
collection accounts, or charge offs, pay back this debt. If this means
calling your creditor and negotiating a payment plan, do it sooner than
later. Also, be aware that paying off a collection account will not
remove it from your credit report – the account will be listed as
paid/current, but the evidence of your missed payments will be carried for
at least the next seven years. Don’t think you can improve your credit
by ignoring your old late accounts and opening new accounts instead.
3.
Decrease the amount of revolving debt you carry: Don’t max out your
credit cards. You’ll owe less money, and have a lower debt/credit
limit ratio.
4.
Don't open a lot of new accounts too rapidly: Creditors run a credit check
each time you open a new account, which could slightly decrease your score.
In addition, rapid account buildup can look risky if you are a new credit
user.
5.
If you are having trouble making ends meet, contact your creditors or see a
legitimate credit counselor: Let your creditors know ahead of time if you
know you’re going to fall late. They are more likely to work with you
if you’re upfront and honest than if you already missed a payment. If
you have already fallen late and can’t catch up, contact a credit counselor
through a local nonprofit, Consumer Credit Counseling Services:
877-901-2227.
Remember, good credit is a life-long financial
habit. Start building it today.
