10 Ways to Raise Your Credit Score Fast

Photo (cc) by Tyler J. Bolken

When I was in my early 20s, I was not what you’d call an informed consumer. Not by a long shot. I remember thinking, when I felt far too busy to worry about paying a bill on time, “It won’t matter. It’s not like they’re not going to get their money.”

What I didn’t understand is that payment history, including late or skipped payments, makes up 35 percent of your FICO credit scores.

Why is this important? Your score determines the interest rates you pay on loans. A low score could easily cost you an extra $50,000 in mortgage payments. Credit scores also affect insurance premiums. Landlords look at them when deciding whether to rent you an apartment. Employers may check your FICO score when you apply for a job.

I’ve wised up since then to what a powerful role credit scores play as a gatekeeper to opportunity in our lives.

Polish your score

There are several types of credit scores, but we’re talking here about your FICO scores, the ones used most widely. FICO scores range from 300 (the basement) to 850 (stellar). You can do plenty to improve your scores. In this video, Money Talks News founder Stacy Johnson tells how to get the fastest results for your efforts. After that, read on for more ways to boost your numbers.

1. Order your credit reports

Begin raising your credit scores by checking your credit history. Records on your use of credit are kept by three major credit bureaus — Equifax, TransUnion and Experian. The reports can differ a bit, so it’s a good idea to get all three, especially since each company is required by law to give you one free report annually.

Here’s the lowdown on how to access credit reports. In brief, go to AnnualCreditReport.com and click “Request your free credit reports” (a red button) at the bottom of the page. Here’s what you’ll need to give: name, address, birth date and Social Security number, driver’s license number and phone number.

2. Correct errors

Your credit score from each bureau is based on the information in your report, so comb them for mistakes. Pay special attention to any incorrectly reported late payments. Also, check that the balance owed on each open account is correct.

Personal finance expert Liz Weston says don’t worry about misspellings of your name, whether a closed account is listed as open, the use of old or wrong addresses, or an old employer who’s listed as current. Focus on these important errors instead, Weston says:

  • Late payments, charge-offs, collections or other negative items that aren’t yours.

  • Credit limits reported as lower than they actually are.

  • Accounts listed as “settled,” “paid derogatory,” “paid charge-off” or anything other than “current” or “paid as agreed” if you paid on time and in full.

  • Accounts that are still listed as unpaid that were included in a bankruptcy.

  • Negative items older than seven years (10 in the case of bankruptcy) that should have automatically fallen off your reports.

There are two ways to dispute and correct mistakes: through the merchant or lender who made the error or through the credit reporting agency whose report contains the error. The Federal Trade Commission explains in detail how to dispute errors and offers this sample letter.

3. Negotiate to erase negatives

Also go after the negatives on your reports that reflect for-real problems, not errors.

You can’t dispute these, but you can ask creditors to erase a charge-off (an uncollected debt) or an account that went to collection. Before paying off the balances on these accounts, try negotiating. Write a letter to the creditor offering to pay the balance in full if they’ll call the account “paid as agreed” on your report, or remove it entirely. Tip: Get the agreement in writing before you pay off the balance.

Here’s a sample letter to use when asking creditors to make a “pay to delete” agreement with you and another for requesting a “good-will adjustment,” where you ask a creditor to remove the record of one or two late payments.

Most negatives, if accurate, can’t be erased. The further they recede in time, though, the less impact they’ll have on your scores. Eventually, they’ll drop off your record. But bankruptcy, foreclosure and delinquent accounts stay on your credit history for seven to 10 years.

4. Know the score

To know how much you’ve raised your FICO score, you’ll need to know what the score is now. The free credit reports you’ve ordered won’t include it. To get your FICO scores, you’ll usually need to pay — up to $19.95. Even then, the score you get won’t necessarily be the one lenders see.

Money Talks News founder Stacy Johnson says that’s outrageous. But so far, efforts to make FICO scores more widely available at no cost haven’t succeeded.

If you do buy your FICO score, don’t pay for additional services, like credit monitoring. You can do that yourself by regularly checking your credit reports.

5. Pay off debt

The more unused available credit you have, the shinier your FICO score is. About 30 percent of your score is determined by the percentage of your credit limits you are using. (All components of a FICO score are listed in this article.)

This is your credit utilization ratio. Example: If your Visa card has a credit limit of $2,000 and your balance is $1,500, you’re using 75 percent of your available credit – way too much. Use no more than 30 percent and preferably less of your available credit.

For a quick boost to your scores, pay off a card or two with low balances. Then work on blitzing the rest of your debts.

6. Raise your credit limits

Pump up your credit utilization ratio by asking your creditors to raise your limit on their accounts.

This strategy isn’t for everyone: Don’t raise your credit limits if the increased credit will tempt you to charge more.

7. Get a credit card

If you don’t already have a credit card, get one or two and then manage them responsibly — paying bills on time and not letting balances accumulate.

If you don’t qualify for a standard credit card, you can build credit with a secured card. Be sure to find a secured card that reports your payment record to all three credit bureaus.

8. Don’t cancel cards

You don’t want to cancel any credit cards because that would cause your available credit to decline. In order to keep cards active and not closed by the issuer for inactivity, put a recurring charge on them, like your Netflix subscription, and then pay them off in full each month so balances do not accumulate.

9. Add variety

You may be able to raise your scores a small amount by adding a different type of credit to your mix. For instance, buy an appliance or piece of furniture on installment, being careful to avoid even one late payment.

“Applying for and getting an installment loan can help your scores if you don’t have any installment accounts or you’re trying to recover from a credit disaster such as bankruptcy,” Weston wrote.

Another possibility is a small personal loan. A credit union is a good place to borrow as they typically offer lower interest rates.

10. Never be late again

If late or skipped payments have lowered your FICO scores, one of the most powerful things you can do to cure your scores is to make every payment on time. Your payment history is the single biggest piece of your FICO scores.

The no-fail cure to late payments is to automate them, as long as you keep sufficient funds in your bank account. (See: “8 Shortcuts to Getting Richer.”)

We’d love to hear your tips for boosting credit scores. Tell us what’s worked for you in the comments below or on our Facebook page.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Read Next
7 Kitchen Gadgets That Make Healthy Cooking a Breeze
7 Kitchen Gadgets That Make Healthy Cooking a Breeze

These small appliances and cooking aids make healthy eating easy — and they’re all available on Amazon.

Have You Heard of This Best Place to Retire in 2020?
Have You Heard of This Best Place to Retire in 2020?

The best place to retire in America is one you likely are not familiar with.

10 Expenses You Should Not Put on a Credit Card
10 Expenses You Should Not Put on a Credit Card

Sometimes it’s simply safer to keep the plastic tucked away.

Beware These 5 Common Work-From-Home Scams
Beware These 5 Common Work-From-Home Scams

You can spot scammers and con artists with a little know-how.

10 Tools You Need for Financial Stability
10 Tools You Need for Financial Stability

Have these tools and accounts in place so you can weather whatever comes your way.

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
11 Senior Discounts for Anyone Age 55 or Older
11 Senior Discounts for Anyone Age 55 or Older

There is no need to wait until you’re 65 to take advantage of so-called “senior” discounts.

20 Things That Are Actually Worth Stockpiling
20 Things That Are Actually Worth Stockpiling

You don’t need a year’s supply of toilet paper to survive an outbreak, but consider stocking up on these items.

9 Things You’ll Never See at Costco Again
9 Things You’ll Never See at Costco Again

The warehouse store offers an enormous selection, but these products aren’t coming back.

Can a Twice-Divorced Woman Claim Social Security Survivors Benefits?
Can a Twice-Divorced Woman Claim Social Security Survivors Benefits?

Understanding survivors benefits rules is the key to getting the most from your benefit.

These Are the 10 Worst Cars for Depreciation
These Are the 10 Worst Cars for Depreciation

Two types of vehicles are especially likely to see steep plunges in value.

Do This With Your Mask Before Thanksgiving Dinner
Do This With Your Mask Before Thanksgiving Dinner

Before you sit down at the year’s biggest feast, make sure to properly care for your mask.

Never Buy These 10 Things With Your Credit Card
Never Buy These 10 Things With Your Credit Card

Credit cards offer many conveniences and protections, but sometimes it’s simply smarter to keep the plastic tucked away.

13 Amazon Purchases That We Are Loving Right Now
13 Amazon Purchases That We Are Loving Right Now

These practical products make everyday life a little easier.

10 Things I Always Buy at Trader Joe’s
10 Things I Always Buy at Trader Joe’s

From snacks to sweets to side dishes, stock your cart with these time-tested favorites on your next TJ’s run.

19 High-Paying Jobs You Can Get With a 2-Year Degree
19 High-Paying Jobs You Can Get With a 2-Year Degree

There are easy high-paying majors available in the U.S. — and no bachelor’s degree is required. We’re here to help you find easy degrees that pay well.

8 Surprising Household Items You Can Sell for Fast Cash
8 Surprising Household Items You Can Sell for Fast Cash

Sometimes, the humblest household items are worth the most money.

Cut These 11 Expenses Now If You Hope to Retire Early
Cut These 11 Expenses Now If You Hope to Retire Early

Like the idea of financial independence? Part of the FIRE equation is cutting costs.

5 Ways Social Security Will Change in 2021
5 Ways Social Security Will Change in 2021

These adjustments will affect both workers and retirees in the new year.

These Are the 4 Best Medicare Advantage Plans for 2020
These Are the 4 Best Medicare Advantage Plans for 2020

Medicare Advantage customers themselves rate these plans highest.

Stop Buying These 19 Things Online
Stop Buying These 19 Things Online

The internet has changed how we shop. But for some things, you’re still better off buying the old-fashioned way.

15 Products You Need — Even If You Didn’t Know It
15 Products You Need — Even If You Didn’t Know It

Discover some must-have products on Amazon that you didn’t even know you were missing.

7 Tips for Building an Emergency Food Supply
7 Tips for Building an Emergency Food Supply

A pandemic or natural disaster could leave you reliant on your existing emergency food supply. Is your pantry well-prepared for emergencies? Knowing what to stock up on for emergencies can be a difficult task and we’re here to help.

3 Ways to Get Microsoft Office for Free
3 Ways to Get Microsoft Office for Free

With a little ingenuity, you can cut Office costs to zero.

11 Things Retirees Should Always Buy at Costco
11 Things Retirees Should Always Buy at Costco

This leader in bulk shopping is a great place to find discounts in the fixed-income years.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.