5 Credit Tips

Here are some helpful ideas to improve your score if you are currently experience credit score challenges

Tip #1 Pay your credit cards as close to zero as possible but do not close them. Closing a credit card nearly always hurt you a majority of the time because you are effectively increasing your debt ratio when you close those accounts. Remember, pay off the credit cards but do not close them and your credit score will increase significantly. If you can’t afford to pay the cards to zero then pay all of them below 50%, it is better for your credit score to have the balances spread evenly over all cards rather than have two maxed out.

Tip #2 When shopping for automobiles or mortgages done within a 14 day period. The credit bureaus will consider all Auto and Mortgage related credit inquiries made in a 14-day period as ONE inquiry for credit scoring purposes. So in theory, if you have credit pulled by a mortgage broker everyday for two weeks it should only be treated as one inquiry for scoring purposes. Our recommendation is still NOT to approach financing in this manner, but the credit guidelines do allow consumers to shop and compare.

Tip #3 Have a Family Member add you on their credit card account as an Authorized User and make sure your Family member gives your social security number to their credit card company. Only do this if they have a low balance and have had the card for at least ten years with a positive payment history. This will give you their payment history and low debt ratio as if the card was yours. This can increase your score over twenty points.

Tip #4 Call all of your credit card companies and ask if you qualify for a credit line increase without them having to pull your credit report. Many will increase your credit limit based upon your payment history. This will decrease your debt ratio and increase your credit score as a result.

Tip #5 If you need to settle unpaid collections we recommend that you negotiate with the ORINGINAL credit first if at all possible. If that is not possible you can tell the collection agency that you will pay 100% of the balance due if they agree to completely delete the account from your credit bureau. If they agree to your terms be certain that you get it in writing on their letterhead before sending them a check. This strategy can be very helpful for your score since a paid collection rally not much better than an unpaid one. You want to ensure that old account is completely removed from your credit profile in exchange for paying it off allowing you to maximize your credit score.