Our credit scores are so important to our financial well being that when our score is not good we would love nothing more than a quick fix to magically give a boost to our ever so important three digit number. Well, unfortunately there is not a magic formula for improving a credit score, but there are certain things you can do to raise your score quickly.
The last thing you probably think about when you have a score that has seen it’s better days is fixing your score with the help of your existing credit cards. If you have credit card accounts that are bringing down your score you can use these accounts to turn your score around. By taking a close look at what’s going on with your credit card accounts you might find just ticket you need to start improving your credit score quickly.
To get you started we have put to together a list of ways you can improve your credit score quickly with the help of your credit card.
Pay Down Your Credit Cards
One of the best things you can do for your credit score is to pay down any credit card debt you have. Now, some times this might be easier said than done, but paying off your credit card debit will do wonders for your credit score. This is especially important if you don’t have a great deal of credit history. Focus on paying down your balances and not so much on paying off high interest rate balances first. This will help get your accounts paid down as fast as possible. However, if you have cards with a high rate then this would be a good time to consider a balance transfer credit card. This can save you a fortune in interest.
Don’t Max Your Cards Out
This is probably an obvious one, but nevertheless it’s important to understand the reason why. If you exhaust your entire credit limit then it will bring down your credit score. One huge factor in determining your FICO score is your debt to credit ratio. The higher your credit card debt compared to your available credit, the lower your FICO score can be. The best thing for your credit is to keep your debt as low as possible and the better off you will be. Plus, when you have credit card accounts that are maxed out that does not look good to lenders who are considering lending you money.
Request a Credit Limit Increase
One way to quickly change your debt to credit ratio is to have your credit limit increased. For example, let’s say you have card balance of $4,000 and your credit limit is $5,000 – this would mean you have used 80% of your available credit. If your credit limit was increased to $7500 then your debt to credit ratio would automatically be lower and you would then only utilizing 53% of your available credit. If you have a solid history with your card company this could be exactly what gives your score a boost.
Become An Authorized User
One full proof way to help your credit score is to become an authorized user on an account that has a long, good credit history. The older the credit history, the better it will be for you. Ask a parent or family member to add you to their account as an authorized user. This doesn’t mean you have to use the account or even be in possession of a card. Their good credit history will start being reported for the both of you.
Photo Credit: SimonQ via Flickr