5 Proven Ways to Raise Your Credit Score Fast

Key points:

• Bad credit is not the end! You can easily improve your score with a few simple steps.
• Study what factors influence your credit first to know which of them you can change.
• Maintain good credit behavior taking into account every aspect of it.
• Be ready to make some effort and go through a long way to your perfect credit. It’s not built in a day.
• If you need to increase your bad credit fast, follow every piece of advice given below.
• If you do everything in the right way, you’ll be able to raise your score by 100 points overnight just by fixing the mistakes on your credit report.

What affects your credit score?

A credit score is just a numeric representation of your credit report. All your financial operations become a part of your credit history and are reflected in the report. Your score is very important when you need to apply for a loan, for example, or open a credit card, buy a house, etc. Of course, you can apply online for a payday loan and get 1000$ with bad credit, but it’s going to be more expensive than for a borrower with a positive credit history.

There exist various models for calculating the score. The three most widely accepted reporting agencies in the USA are Equifax, TransUnion, and Experian. And your credit may differ with each of them as they use different scoring models. Their numbers also vary due to the fact that some lenders prefer to report only to one or another, and some lenders do no credit checks at all. Consequently, credit bureaus get different information which leads to different results.

Still, the most important factors that your credit score builds on are:

• Your payment history, especially late or missed payments.
• The amount of revolving credit you're using should show that you tend to use not more than you need.
• The length of your credit history.
•  The variety of credits you have maintained during your financial history.
• On-time payments and debt.
• Hard inquiries. Hard inquiries occur when a lender or creditor checks your credit after you apply for a new line of credit. Frequent hard inquiries can negatively impact your credit score and may suggest to lenders that you are trying to take out more credit than you could reasonably repay.
• The frequency of hard credit checks lenders have done.

5 Steps to Improve Your Credit Score Fast

When you already know the 5 main factors used into account when calculating your credit score, it’s easy to figure out which steps to take in order to boost it:

Step 1. Start building a positive credit report – open several active credit accounts in your name. It will let you get a few credit reports from lending companies or other creditors.

The best ways to start your credit are credit-builder loans, secured credit cards, being added as an authorized user on another person’s card, etc.

Step 2. Make all your payments on time – avoid late or missed payments. This is one of the most important factors influencing your score. Any time you default your payment longer than 30 days, it might be reported to the credit agency and badly hurt your rating. Automatic payments may help here. If you have too many loans to pay off which are hard to keep track of, consider getting a debt consolidation loan. It will allow you to cut all your bills down to one convenient payment.

Any potential payment you are going to miss must be discussed with the creditor in advance. You may come to an agreement on a repayment plan, or any other solution that will not damage your score.

Step 3. Pay off your debt. Keep all your accounts current to prevent any late payments from being added to your credit file. Manage your debt by negotiating it with credit counselors. If you are not sure that you’ll be able to repay the debt, consider applying for No credit check payday loans which lenders don’t report to any of the credit bureaus and which won't damage your score.

Step 4. Work at your credit utilization rate improving it with the help of a lower balance on your revolving credit accounts. Try to keep the balance very close to its credit limit and not higher. Ideally, your credit utilization ratio must be not higher than 30%.

Step 5. Try to Minimize Applying for New Accounts. If possible, don’t apply for loans too often. Or choose the lenders who do no hard credit checks. A soft inquiry won’t do much damage to your score but if done too frequently, it may lead to bad credit.  Constant new accounts lower the average age of your accounts which is not good.

How to raise your credit score fast?

It’s hard to say how long it’s going to take you to improve your credit if we don’t know the reason for its poor state. No wonder, people with bad credit want to raise it really fast, overnight preferably. But let’s be realistic. If you used to miss payments or go beyond your credit limit too often, you need some time, at least a month, to rebuild the score.

If the reason for your damaged credit score is just one or two missed payments, just go back to this account of yours and keep making payments on time. In this case, you can raise your credit really fast.

But if you have missed payments on numerous accounts for a long period, recovery will take you more time.

Rollovers, loan defaults, repossessions, or foreclosure may make the situation even worse and the term of your credit improvement much longer.

Most of your financial drawbacks stay on the credit report for as long as 7 years with only bankruptcies remaining there for up to 10 year-term. After these periods of time, they diminish letting you start everything from scratch.

If you find it too complicated to boost your credit score yourself, apply to a special company that will help you for a fixed price. Sounds good at first, but anyway they will just give advice and all the job must be done by you. They won’t make payments instead of you or take care of your credit card balances.

Credit builder loans are another option. If you borrow responsibly, apply for a loan you are sure to pay off on time, and the lender will report to the credit agency. It will show your positive financial behavior and good debt management skills.

How to build your credit from scratch?

Having bad credit is not very pleasant but having no credit at all also seems a problem. Lenders may not approve borrowers with no credit as they don’t know what to expect of you.

If you just start your way in the world of finance and have no experience with loans, credit cards, bank accounts, etc, your credit file is empty, credit agencies just can’t grant you any score yet.

To build the credit, at least one 6-month-old account is required. You need to show some activity on it within half a year. Some credit modelling systems can calculate some score earlier just as you open the account.

When you just start building your credit, choose the companies that report to all three credit agencies so that the lenders might do an inquiry to any of them and there was some record of your credit score already.

Additional tips to boost your credit

• regularly check your credit report – you can do it for free
• set up payment reminders
• pay more than once in a billing cycle
• negotiate with your creditors
• apply for new credit carefully only if really needed
• don’t close old credit card accounts
• pay down “maxed out” cards first
• make your accounts varied
• try to qualify for a 0% interest card
• consider debt consolidation loans
• make sure payments arrive before the statement closing date
• become an authorized user for some responsible credit card holders.