How Can I Fix My Credit Score?
If you have damaged credit, you may be wondering if there is any way that it can be fixed quickly so that you can, for example, apply for a loan. You may be surprised to learn that there are ways to clean up your credit report in as little as 30 days, depending on what it is that’s hurting your score, but not everything can be fixed this fast.
Our expert attorneys identified a few simple ways to help you improve your credit score and bolster your financial health. Here’s a quick guide to improve your credit score.
What is a credit score and why is it important?
A credit score is a number that defines your creditworthiness and reliability in the eyes of lenders. It is used to evaluate the probability that you can repay your debts whenever you borrow some money, and it is based on the information found on your credit file.
It ranges from 300 (really bad) up to 850 (perfect) and is used by banks to determine how much they can lend you as well as the interest they will charge you. If your credit score is too low, a lender may even refuse your loan application. Normally, if you want to secure a loan without being burdened by unfavorable interest rates, your credit score must be above 700.
According to recent surveys, people find it more embarrassing to admit their credit scores (30%) than their weight (12%). Just like you can shed some excess weight by following a diet, there are a few effective methods to fix your credit score.
- Recovering from financial mistakes
If your credit score is less than perfect because of a few financial errors, it may take some time for your score to make a full recovery depending on exactly what is causing the dip in your score. Some negative information can take seven to 10 years to age off of a report.
However, if your score is bogged down by high debt, you can improve your score by paying down your credit cards. This will adjust your credit utilization rate, which is a measure of how much revolving credit you carry in relation to your limit.
- Report errors on your credit report
If you have found an inaccuracy on your annual report, it is important to inform the reporting agency as soon as possible because incorrect information can harm your score. According to the Fair Credit Reporting Act, credit reporting agencies have 30 days to investigate a claim once they have been notified by a consumer.
In theory, you could have the error removed during this time, but there is no guarantee that the agency will act that quickly. A skilled attorney may dispute errors or, at least, ask the creditors to erase your debt by negotiating the terms.
- Look out for family issues
Some unwanted family issues may impact your credit score. For example, if you keep moving homes a lot you may incur a penalty. Lenders feel more comfortable if you can provide evidence that you did not change your address for a long time.
Don’t forget to check if you and another person are linked together. If you have a spouse or family member’s credit rating linked to you through a joint account, your personal rating may be affected if their score is poor.
- Keep an eye on your yearly credit report
To really stay on top of your credit, you should review your report annually. You can access your personal file for free on sites like Annualcreditreport.com or you can pay a credit scoring agency.
Everyone’s credit problems are different, but as a general rule of thumb, it is important to make all payments on time, keep your debts to a minimum, and add a mix of credit accounts over time. The longer a bill goes unpaid, the more it will negatively impact on your overall score.
Your credit score is the backbone of your financial health. If your credit score is suffering as a result of old debts that you are struggling to repay, the time is now to contact a St. Petersburg attorney at Boss Law. We’re committed to helping people find the solutions that work best for them!
To schedule a free consultation with our firm, please call (727) 877-3188.