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Credit Score Tips

How To Improve Your Credit Score In Six Months

May 10, 2021 2:23 pm | Credit

Improve Credit Score
Improve Credit Score

It’s time to take credit repair seriously. If you’re even considering financing a significant purchase, such as a new car or home, your credit score must be in the excellent range. This blog post will show you how to do just that!

Review All Copies Of Your Credit Report

The first move to make when improving your credit is finding out where you stand. You can access your credit report from several sources for free. If you’ve been denied credit or had trouble getting approved in the past 12 months because of a weak credit profile or incorrect entries, taking steps to fix errors and build a more robust credit file is in your best interest.

Check For Reporting Errors

You might be surprised to learn there are millions of people who have errors on their credit reports. These reporting errors can result from identity theft, a business leaving out negative information, or another type of credit mix-up.

A thorough investigation into your credit reports will help you see where any errors are happening and how they might affect your current standing. And with three different reporting agencies, there’s always the chance there’s an error on one report that’s not shown on the other two, so it’s critical to review information from Equifax, Experian, and Transunion to make sure everything is correct.

If you find erroneous accounts, you can dispute these items directly on the website to get them reviewed for accuracy. Entries that can’t get confirmed are subject to removals, such as collection accounts, old addresses, and other erroneous information. Getting these items removed can help to boost your credit score, enabling you to qualify for more favorable financing options.

Make Your Payments On Time

The most reliable way to increase your credit score is by making all your scheduled payments on time. This bill payment approach applies to credit card payments and includes utility bills and other monthly expenses.

One way to avoid missing payments is by utilizing automatic payments. By doing so, it doesn’t matter if you’re out of town or if you completely forget your payment is due. As long as your connected bank account has enough money to cover the bill, the charges get processed. Automatic payments help avoid late fees, penalties, and other negative consequences from missing a payment, including big hits to your credit score.

Review Your Credit Report Before Seeking New Credit Lines

Every financial move you make affects your credit score on some level. If you know that you’re planning to make a large purchase such as a new home or car, getting your financial house in order should be a high priority in the 6-24 months before you seek credit.

Again, review your credit report for errors or omissions. Fixing these mistakes can significantly improve a person’s credit score and could result in thousands of dollars of savings on interest rates over the life of an installment loan.

If possible, pay off any outstanding loans, including balances owed to family members. With less overall debt, it shows potential lenders that you can repay the loan.

Other Steps To Improve Your Credit

Other ways you can boost your credit standing include increasing your income. By boosting your income, and reducing your debt, the landscape of your debt-to-income ratio changes. Your debt-to-income ratio impacts your creditworthiness and your overall credit score.

It doesn’t matter how poor your credit score was in the past. You can continuously improve it with a bit of work. We’ve provided some helpful tips that should help you know what is needed to raise your credit score and qualify for better interest rates on loans or other financing options.

We hope this information helps you to achieve your financial goals and objectives! Our Velocity Banking Calculator can help you gain a greater understanding of your financial situation!

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