3 Tips to Increasing your Credit Score

credit-cardsIf your credit score is below or around 660, there are 3 easy things you can do to boost your credit score. It is very important to have the best credit score you can possibly get since it will determine what kind of interest rate you will receive on a loan. If your score is too low, you will receive a high interest rate which means you have to pay more.

Pay Every Bill on Time

A late payment will instantly drag down your score. A few months history of timely payments, however, can help boost it.

This is true. I always schedule my Online Bill Pay once I get my bills. That way, I know I will never forget about the bill. Just to be sure the payment goes through, I usually also setup an account with the company’s online website to see if the payment was received or not. That way, I am never late on my bills.

Pay Down the cards that are maxed out first.

You’ll get points deducted from your score any time you charge more than 50 percent of the limit on any kind of credit card.

Personally, I never really had any credit card debt, however, my personal opinion is usually to pay down the credit card that has the least dollar amount. At least that way, you get one of the cards out of the way and you can concentrate on your other credit cards. Of course, if you have a card that has 0% interest rate and you are confident that you can pay off the card before the 0% offer ends, you might want to pay other cards that have interest rates off first.

Do not cancel any credit cards.

Counterintuitive, yes. But not when you consider that one-third of your score is based on how much of the credit available to you you’re actually using. Cutting up credit cards will automatically decrease the amount of credit you have available. Better to stick the cards in a drawer until your score is back on track.

I agree with this article partially. You can just keep the cards active but cut them up so you won’t be able to use the cards. That way, the credit cards are still counted towards your credit score.

What are your opinions?