For many, building credit fast can be a difficult task. This is especially true if your credit history is poor or non-existent. It's a long and tedious process but essential to your future financial security. Good credit is essential for many financial goals. This includes renting an apartment or car, getting a mortgage, and even signing up for a cell phone plan.
You can use smart tactics to accelerate the credit building process. Here are the best ways to improve your credit score and build credit quickly:
1. Make sure you pay all bills on time.
It's more than a convenience issue: on-time payment of your bills is the single biggest factor that impacts your credit score. A big mistake can be paying late on your debts. This could affect your score forever.
2. Avoid carrying a high balance on your credit card.
Your credit utilization ratio should remain as low at possible. This refers to the amount of credit available on your revolving cards, lines of credit and credit card accounts. A credit usage ratio of more than 30% can have a negative impact on your credit score.
3. Request a higher limit on your credit card.
You may be able to get a higher credit line if you're a loyal customer and have been consistently paying your bills on time. It's important to read the card's terms and conditions before requesting a higher credit limit. Some card companies will do a hard search on your credit history, which may temporarily lower your rating.
4. To build your credit quicker, use a secured credit cards.
If you're a first-time credit user, a protected card can make it easy to build credit and establish an excellent payment record. Secured credit cards offer a low credit limit for a security deposit. After a few months of responsible usage, your secured credit card can be traded in for an unsecured one.
5. You can take advantage of credit agencies' free tools and service.
For establishing credit, there are many free resources available, including websites which can help you to request free copies from each of the three major bureaus, Equifax Experian TransUnion. Credit agencies can help you dispute inaccurate information, and repair your credit scores.
6. Clean up your credit report to remove late payments or other errors
It's not a secret that mistakes in your credit report can have a negative impact on your score. They are easy to overlook and to keep hidden. That's why it's so important to regularly check your credit reports for errors and file disputes to have them corrected.
You can improve your credit immediately by taking action to correct errors and missing information in your credit report. The number of errors, and your overall credit score, can determine how quickly you improve your score. It could increase by more than 100 points.