General Question

Ineedtoknow594's avatar

What's the best way to improve my credit?

Asked by Ineedtoknow594 (92points) September 6th, 2008
Observing members: 0 Composing members: 0

13 Answers

JackAdams's avatar

Consult with a professional credit counselor who has an excellent reputation with the Better Business Bureau, then do as s/he advises.

It will be worth the fees.

trudacia's avatar

Pay your bills on time and don’t max out every card.

buster's avatar

Don’t get sick or hurt. My credit is screwed because of hospital visits.

blastfamy's avatar

I heard that a cheaper option is to take out a loan that you already have the money to pay off from a bank. Pay it off on time to demonstrate your good-with-money skills.

poofandmook's avatar

Another good way is to get up like $200 and get a secured card. You give them the $200, they give you a credit line of $200. Orchard Bank is good one for that. Don’t use it, or if you use it, pay it off before the due date. Your Debt:Credit ratio is a huge part of your credit score. The goal is to have a lot of credit cards/open lines of credit that stay clear of debt… in other words, they go unused. Some will force you to use them just to keep them open. Store cards like Sears and JCPenny often will send you notices saying that they’ll close your credit account if you don’t use it. You can go to those stores, buy a pair of socks or something silly, small, and cheap that you’ll use, and then go right home and send out the check to pay it off.

JackAdams's avatar

One good way to improve your credit, is to use high explosives on those who are claiming that you have BAD credit.

Yes, I am joking…

Lightlyseared's avatar

buy stuff on credit. Pay your bills on time but don’t clear the balance every month. Credit companies like people they can make money out of and really like people who pay them back.

poofandmook's avatar

@Lightly: Yes, credit card companies like that, but it doesn’t affect your credit score any differently if you use them as opposed to not using them. Not using them keeps your Debt:Credit ratio bare so there’s no risk of having to pay the credit card company any money in finance charges, late fees, any of that garbage. The safest way to keep your score higher is to not use the open lines of credit at all, unless the company threatens to close the line if you don’t use it. Then you use it for the cheapest (but still useful) thing possible and send the check out (or pay online) that same day or the next so that you pay off the balance before they slap on the finance charges. If you do this right after your last statement closes, you’ll have no trouble getting it paid off before they start the process of your next statement, therefore keeping it open, saving yourself the money of finance charges, and keeping your score up.

JackAdams's avatar

In all seriousness, the very BEST way to improve your credit, is to marry someone who is at least a multi-millionaire.

Hey, it worked for the wife of Bill Gates!

poofandmook's avatar

[removed by myself]

Lightlyseared's avatar

@poof I disagree. The bulk of your credit report consists of details about credit accounts that were opened in your name including the credit limit on the account (this is the important bit for imporoving your credit, the more VISA or Mastercard will lend you the more other people are likely to lend you). If you NEVER use your credit they will never increase your limit. If you pay off the full balance before the credit company charges interest to your account it will have no effect in imporving your credit rating because you haven’t used credit. If however you run up the limit on your card occasionly leave it a couple of months and then pay off the whole balance the credit card company will increase your limit (because you are good customer) and this improves your credit report in the eyes of others. The important thing to remember is to pay the bill on time ever month as an overdue payment will look bad.

poofandmook's avatar

@Lightly: If the card is vigilant with reporting to credit bureaus, when they report that your card is at limit, your score goes down for having a higher debt:credit ratio. I’ve been fighting to improve my own credit for over a year now. My good friend who is teaching and helping me works for Experian, so… I’m just repeating back what she’s taught me.

Lightlyseared's avatar

yes but you dont keep it at the limit. You spend some money on the card, pay some interest, and then you pay it all off. This will encourage the credit card company to raise your limit and the limit as I’m sure your friend will tell you forms an important part of teh report. Obviously you also have to be paying off the credit all the time on time to keep your credit rating good but the question was how to improve it and that technique will improve your rating quickly assuming you havent spent years generating a bad credit history. It has worked for me very well thank you (mind you that was in the UK).

Answer this question




to answer.

This question is in the General Section. Responses must be helpful and on-topic.

Your answer will be saved while you login or join.

Have a question? Ask Fluther!

What do you know more about?
Knowledge Networking @ Fluther