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Posts tagged ‘credit score’

Ten steps to a good credit score

Credit score! You have probably heard a lot about it. It is a measure of your financial stability. You go for taking up a loan today and your creditors would surely be concerned about your credit score. It helps your lenders to predict the chances of you defaulting on your loan.  Read on to know how you can boost your credit score.

  • Ask for credit reports: You get a free copy of your credit report from the three main credit reporting agencies i.e. Equifax, Experian and TransUnion every year.
  • Look out for errors in the credit report: Check your report for inaccuracies; if there are any items that you have settled but is still showing as unpaid or any account that you have closed but which is still showing open.
  • Pay attention to the most recent 12 months first: Your credit report is affected most by collections and unpaid accounts which have occurred recently.  You can take care of older items later.
  • Dispute errors that appear on your report: If you find any error in your report, write a letter to the card issuing company asking them to delete the item. The company should respond to your dispute in 30 days.
  • Keep all communication documented: Ask your creditor for a letter which states that your account has been settled. Keep copies of all the letters so that you can produce them whenever necessary.
  • Request the credit reporting agencies to delete the errors from your credit report: Send copies of letters to all the three credit reporting agencies and request them to delete the errors form your report.
  • Negotiate: It is best to negotiate with your creditors; they usually work with you, unlike the collection agencies.
  • Get help: If you feel that you need help in repairing your credit score, you can always opt for credit repair and credit counseling companies. These companies can help you to restore good credit.
  • Close unused accounts: It is best to close your unused accounts if you want your credit score to improve.
  • Pay on time: The most important step to establish a good credit score is to make your payments on time. Pay off your balance each month and never be late on your payments.