How to Improve Your Credit Score
A good credit score is your passport to approvals. Lenders will look at that number to determine how risky it is to provide you with financing. Scores can determine your rate, term, or even if you get the funds at all.
If yours is lower than you’d like, you should know that there is no quick fix. In fact, the so-called simple tricks you’ll find online will most likely backfire. Responsibly rebuilding your credit score takes time and effort, but if you want to improve it, here are some tips.
Know Your Number
Your score is a three-digit number that comes from one of the major consumer reporting agencies, Equifax, Experian and TransUnion. A FICO® Score, created by the Fair Isaac Corporation, is used by many lenders. At America First, you can see your FICO® score just by logging in to free online banking–checking it as many times as you like without affecting your credit rating. In case you don’t know if your number is good or bad, here is a quick breakdown:
- Exceptional: 800+
- Very Good: 740-799
- Good: 670-739
- Fair: 580-669
- Poor: under 579
Every year, you can get a free copy of your full credit report. Scan the documents from all three bureaus for any errors that negatively affect you. Are all your accounts listed? Are there any applications you didn’t set up and don’t recognize? Are there payments listed as late that you can prove were made on time? If you do find something incorrect, you can dispute it with the agency reporting the error.
Pay Your Debt Down
Start reducing your debt at a steady & deliberate pace. Don’t just move it around. Keep your credit card balances low and pay off your monthly charges. Also, be sure to stay current with all your bills. With America First online banking, you can set up alerts that notify you when a loan payment’s due and enroll in free online bill pay for automatic transfers. These will take care of utilities, your phone, cable and other accounts on time, every time. Paying your debts consistently and in full is the best way to improve your credit score.
If you think your credit is beyond repair, talk to an expert. America First offers free financial counseling for every member. And remember, building up your credit isn’t a sprint, it’s a marathon. Consistency and responsibility are your best options for improving your credit score.