You can increase your credit score from 480 to 700 by following a few steps given below.
Your credit score is your financial gateway to the things you want in life. Your credit score is used for the following; when you buy a car, rent a car, rent an apartment, buy a house, college loans, buy the newest computers, electronics, and is also used by insurance companies when you need insurance.
Credit scores range from 300 to 850, and any score below 500 is considered a higher risk for lenders. Trying to keep a score above 700 will improve your chances of getting a loan for larger purchases, like a car or home. With a higher score, you can get better interest rates and terms on your loans.
Get a 3 to 1 credit report
Go to Creditreport.com to get a free copy of your credit report. You want the 3 to 1 so you can see the full report from all 3 credit reporting agencies. Check your report for inaccuracies, like someone else using your credit or anything that shouldn’t be there. This could be identity theft and should be reported immediately.
Make sure each of your creditors has accurately reported their information. If you find there are errors, write a letter and mail it to the credit reporting agency along with any evidence to support your dispute. You want to remove this inaccurate information from your credit report as soon as possible.
Consolidate Credit Cards
Transfer balances from cards with higher interest rates to cards with lower interest rates. This will lower your credit score by getting rid of too much debt.
Check your finances
Gather all your finances. Find a place where you can squeeze in, say, an extra $100.00 each month. Take this money and apply it to the credit card with the highest interest rate each month until you pay it off. Then take that money and pay off the next credit card with the highest interest rate, and so on.
Avoid the maximum limit of credit cards
Being maxed out on a credit card can lower your credit score. A good benchmark is to only have 30% of the maximum amount available on the card. If you have a credit card with a balance of $1000.00, keep the amount on that card around $350.00 to improve your credit score.
Pay your bills on time
Make sure you consistently pay all your bills on time. Paying your bills on time is one of the main elements credit bureaus use to calculate your credit score. (35% of your score is based on payment history)
Pay more than the minimum due on each credit card, paying only the minimum due is a sign that you could fall behind on your payments and can be a high risk.
Close unused credit cards
Simply destroying your cards doesn’t work. You must call the credit card company and request that they close your account so that it no longer appears on your credit report. This will help increase your credit score.
Request More Credit Chorus
Every inquiry is reported to the credit bureaus and multiple inquiries can negatively affect your score. If there are no inquiries for a 2-year period, lenders are more willing to extend credit, confident that you won’t overextend and default.
Using these helpful tips can help you build your credit over time.
