If you’re looking to learn how to increase your credit score, you have to start by understanding your credit score. One of the biggest reasons people struggle with maintaining a decent credit score is because they don’t understand the different elements of it. They don’t know who the enemy is so to speak. There are certain things that impact your credit score negatively and if you don’t know what they are how can you avoid them. Adversely there are also things that positively effect your credit score and you can’t keep doing these things if you don’t know what you did. So in case you haven’t been told up to this point. You must know these things in order to be successful at controlling your credit situation.
- What makes up your credit score? Understanding these 5 basic elements of your credit score drastically increases your chances of success.
- How can not knowing effect my credit score. You need to be aware of the importance of your credit score. How it effects the future purchases you’ll try to make, how it could determine where you live or work.
- So now that you know the importance of it and what it’s made of, it’s time to focus on cleaning it up, stabilizing it, and learning how to maintain it in the future.
In this article I’ll address the first area of concern what makes up your credit score, and recommend a very affordable and viable options for those of you serious about learning how to increase your credit score.
What Makes Up Your Credit Score? Understanding These 5 Key Components Is The First Step In Learning How To Increase Your Credit Score
Payment History: You could be affected by your payment history without knowing it. Think that paying a little late doesn’t matter, wrong think again. Maybe a creditor has made a mistake and reported you as being late. That’s why it’s important to thoroughly analyze your credit and monitor it on a regular basis. You may not know you’ve been reported late until it’s to late and you’ve been rejected or charged a higher rate because of it.
Account Balances: Where do you stand in terms of your amount of debt versus your income. That’s right your DTI or Debt to Income Ratio plays a huge roll in how banks look at you in terms of being a risk factor. If more than half of your income is dedicated (or need to stay up to date on your debt payments ) you’re considered a high risk candidate for new or additional lines of credit. If you know where you stand going in, you may be able to put of getting that line of credit until you’ve reduced that ratio, while at the same time helping you to get that loan at a better percentage.
Account Age: This is a big for for a couple of reasons. First half the time you don’t even remember what it is you were trying to buy 3,7, 10 years ago, yet it’s still showing up on you’re credit and still hurting you. The second key reasons is, this is one of the easiest marks against you to erase or get deleted. Often times you can either get it complete removed or negotiated a small fraction of the original debt to get it taken care of. Understand these creditors have all but written off the thought of reason this funds. So they would much rather get something rather than nothing. Even better for you sometimes you’re able to dispute them rather easily and get them removed fairly easily due to the age of them. So companies might not even be in business now. Take a look at your credit you could be missing out on easy opportunities to boost your score a few points with a little effort.
New Credit 
ay attention to how many different lines of credit you’re applying for. You can think of it’s as I’ll just try the next guy. You can’t go to 5 different stores trying to get approved to buy one thing. You don’t know how many banks they’re working with. If each submits you to 3 banks you can see how quickly that could add up. If creditors see that you’ve been applying and getting denied often recently, why should they be the one to take the risk on you. Also if they do take the risk you can bet they’re going to get that “special rate reserved for high risk candidates” I mean why shouldn’t they be rewarded more for taking a risk on you? Right? Protect yourself pay attention to Who, What Where, and How Many credit inquires you are racking up.
Account Types: Your credit score is simply a way for creditors to feel comfortable about giving you their money. One of the things that makes them feel the most warm and fuzzing inside is by knowing that a lot of different others have trusted you with their money and you’re honoring your contract and paying these people back when and what you agreed on. So if they see you not only have several types of credit and you’re doing right by them they feel safe lending you more. Adversely if they see a lack of accounts or only one type of credit (like only credit cards) it puts more doubt in their mind that you’re a good person to lend to. So you should have a diverse portfolio of credit. Several different types in GOOD standing.
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Credit Analyzer will give you a breakdown of each of the categories above, as well as suggestions for improvement in your score based on what is currently being reported to the bureaus. Many times, inaccuracies can accrue due to oversight on the part of the credit bureau as well as the credit holder. Credit Analyzer also tells you how to increase your credit score (5 different ways to boost your score).
If your credit needs are greater than just the analysis, there is an experienced staff of credit specialists available to assist you. The difference between a “good” credit score and a “great” credit score could save you from hundreds to thousands of dollars on interest payments alone year after year. When used properly, credit can help you qualify for a loan, and save you money.
I NEED THE CREDIT ANALYZER NOW!
It’s simply enough anymore to hope your credit score will just rise over time. You can’t sit back and hope the banks haven’t made any mistakes or someone has tried to used your information. You need to be proactive find out what’s on there, what doesn’t belong, and what you can change. Your credit score is more important today than every before, because of these ruff economical times. Banks are more cautious, and every penny counts. Stay tune for the next part of this series HOW TO INCREASE YOUR CREDIT SCORE.
