Saturday, April 25, 2009

How To Improve Your Credit Score

You have no idea that after you read this short article you will have learned how to improve credit score with barely any hassle at all. And you will start to feel better and better about raising your credit score and getting out of debt.

Because, despite what you may have heard, there IS light at the end of the tunnel.

But I’m jumping way ahead of myself.

Before we go any further, let me say this to you…you have to drop your ego and think the same way creditors do if you REALLY want to increase your credit score.

With that in mind, by the time you finish scanning every line in this article, the necessary steps will become clearer and clearer.

So let's look at how to improve credit score while at the same time creating a credit rating that will stack the deck in your favor.

Surprisingly enough, this is a real life solution that you can start applying today.

In nutshell, I think the main problem with people who are hammered to a pulp with low credit scores is over-doing it with credit card spending.

In other words, they rely on their credit cards daily and quite frequently reach the maximum limit.

But here’s the thing. When you are constantly getting close to or even going over your spending limit, your credit score is dealt a fatal blow.

Pound for pound, the one main rule as you are working on how to improve credit score is to drastically limit your credit card usage. It’s the one real truth of credit repair, yet so many of us violate it day in and day out.

Let me explain exactly what I mean:

Any time your credit card balances are more than 50 percent of the available limit; you are headed down the wrong path.

My hunch is that don’t know that creditors and lenders see this as a sign of weakness.

They automatically assume you have financial trouble and in turn could be a huge financial risk.

But, there’s a solution, if you are interested.

I’m telling you, it’s a game of inches, and if you cut those credit card balances down to around 30 percent of the available balance your FICO credit score get the boost you’ve been looking for.

I’d also like to tell you about opening new accounts. Learning how to improve credit score means understanding your debt-to-credit ratio.

This one mistake could cause you years of trouble. Additional inquiries on your credit report in a relatively short amount of time can lower your credit score significantly.

The rule of thumb is the more inquires you have – the more likely you are to file for bankruptcy.

When you have poor credit, you can’t afford mistakes like these.

Are you beginning to see that figuring out how to improve your credit score will pave the way for amazing buying power for you?

You know you have to make a decision about how to improve credit score. You have to decide to cut your spending or either limit the number of new accounts you open. But to be on the safe side…you’d better consider doing both, don’t you think?