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1. Pay your bills on time.
If your credit card bill (or sometimes utility bill) is not paid on time it will reflect on your credit report. Late payments will have a HUGE impact on your credit rating. PAY YOUR BILLS ON TIME!!!!
2. Don’t use all of your credit.
Amount of outstanding debt is another significant factor in the calculation of your credit score. If your debt % is more than 30% of your credit line, you might be penalized by getting your score lowered.
3. Be careful when applying for loans/credit cards
If you are applying for too many cards in the short period of time your credit score will be lowered. As a rule of thumb don’t apply for more than 1 credit card a month.
4. Be careful when co signing a loan
Remember if a person you cosigned with defaults on the loan (or has late payments) your credit score might be affected. You will also be responsible for the loan if that person doesn’t pay. Choose very carefully the people you are going to co-sign with.
5. Monitor your credit
Make sure to check your credit report at least every 4 months. You have an opportunity to get a free credit report by going to
http://www.annualcreditreport.com . You can get 3 free report each year (1 from each reporting agency). Make sure you take this opportunity.
6. Watch your spending
It’s very easy to buy things with credit cards. All you have to do is swipe it and the thing is yours. You have to realize that even though you can buy something today without paying, eventually you will have to pay for that item (and interest charges if you don’t pay balance in full that month). Some people end up paying $10–$15 for a $2 item (after paying all the interest charges).
7. Watch your debt to income ratio
8. Choose credit cards wisely
Don’t apply for all the credit cards you run in to. Make sure you know if there are any annual fees or any other fees associated with cards. Also make sure that APR rate is low enough (or corresponds with your credit score). DON’T apply for store credit cards. Their APR is usually to high and sometimes you will be tempted to use them more than a normal credit card.
9. Dispute inaccurate information on your credit report in a timely manner.
The number of identity thefts are on a rise. Make sure you check your credit report, and if you see any suspicious activity dispute that in a timely manner. After all you want your credit score to be high.
Resources:
BOOKS:
Your Credit Score: How to Fix, Improve, and Protect the 3-Digit Number that Shapes Your Financial Future, 2nd Edition
Credit Repair Kit For Dummies (For Dummies (Business & Personal Finance)): Steve Bucci: BooksDVD:
Fix Your Credit DVD – How to Fix Mistakes on Your Credit Report and How to Improve Your Credit Score (Credit Repair): n/a: Movies & TV
Tags: Credit Cards, Credit Report, Credit Score, Finance, Improving Credit, Personal Finance