How To Quickly Boost Your Credit Score

Today I’m going to reveal 5 little-known ways to quickly BOOST your credit score overnight.

In fact, these tips have helped me raise my credit score to 800 in 30 days and get the best interest rates on every loan.

If you are looking for strategies to improve your credit score, lower your debt, and take control, this guide is for you.

Let’s drive right in.

Overview

  1. Always pay the minimum balance
  2. Reduce Credit Utilization
  3. Limit “Hard Inquiries”
  4. Use debt consolidation
  5. Do not close old credit cards
  6. Use credit tracking software

Always Pay The Minimum Balance On Time

First and foremost, payment history is the most important factor that influences your credit score. Of all the factors, on-time payment history accounts for 35% of your score. It goes without saying that having late payments will classify you as a high risk borrower.

If you have outstanding debt, such as student loans or home loans, making consistent payments on time can actually help boost your score. We recommend following a few tips to ensure you never miss a payment:

  • Use automatic billing to withdraw from your bank account
  • Set alerts and reminders before payments are due
  • Keep bills organized to keep track of your expenses

Late payments have a large effect on your credit history and stay on your credit report for multiple years. Needless to say, always pay the minimum balance on time to avoid lowering your credit score. Following a strict financial plan can help eliminate the possibility of falling behind on your payments. Make sure to keep up to date with your upcoming expenses.

Reduce Your Credit Utilization

Credit utilization is defined as the amount of credit you are using divided by your total available credit. Lenders want to see a low credit utilization ratio in order to classify you as a low risk borrower. Your credit utilization accounts for 30% of your score. Ways you can reduce your credit utilization include:

  • Ask your bank for a credit limit increase
  • Open new lines of credit, such as a new credit card
  • Reduce your spending

Almost all of the time, credit utilization plays a large part in determining your credit score. It is important to keep this ratio under 30%, as lowering this ratio will help raise your credit score. A lower credit utilization ratio can signal to lenders that you are responsible with your credit.

Limit “Hard Inquiries”

When opening news lines of credit, lenders will often run a “hard inquiry” against your credit. This occurs when you apply for items such as a student loan or home loan. Hard inquiries can say on your credit report for multiple years, therefore, we recommend limiting the number of hard inquires you receive in order to keep your credit score as high as possible.

Some ways to limit hard inquires include:

  • Wait 1-2 months between opening new lines of credit or getting a loan
  • Ask the lender to run a soft inquiry when retrieving your credit history
  • Open new lines of credit only when they are necessary

Make sure to take note of each line of credit you plan to receive. Opening multiple lines of credit at the same time can have a large effect on your overall credit score.

Use Debt Consolidation

If you’re in a position where you have large amounts of high interest debt, consider using debt consolidation. Debt consolidation is where outstanding debt is grouped into one loan at a lower interest rate. In the long term, debt consolidation has the potential to save you large amounts of interest you would otherwise have to pay.

Some popular banks that offer debt consolidation services include:

  • Discover
  • Bank of America
  • JP Morgan Chase

Balance transfer credit cards are another alternative for consolidating high interest credit card debt. Most balance transfer credit cards have a 1-3% debt transfer fee, however, this amount can still be a valuable option when considering the interest saved through a lower interest rate.

Do not close old credit cards

A large factor in the credit scoring algorithm is the length of your credit history. Lenders want to see you have experience using credit. If you have old credit cards, do not close them as it will decrease the average length of your credit history. Closing these cards will erase all previous credit history associated with the card.

Instead, if the cards do not have a high monthly fee, try to keep them open as long as possible in order to increase the length of your credit history. This will signal to lenders you are a responsible borrower and have a history of paying off debt on time.

If you are just getting started with building your credit, sign up for a credit card as soon as possible. The longer you have a line of credit open, the longer your average credit history will appear. A common mistake is to cancel old cards, however, we advice against this as it will impact your overall credit score.

Try Credit Tracking Software

Credit tracking software can help you gain insight into the factors that influence your credit score. Using credit tracking software is another way to ensure your credit history is up to date. These services can run a soft inquiry to retrieve your credit score without impacting your score.

With credit tracking software, you can dispute late payments and inquiries directly form their dashboard. It is important to maintain a vigilant watch over your credit history. Software such as PrivacyGuard or CreditSesame can also help prevent fraud and detect suspicious accounts.

Credit tracking software can also give you an overview of your entire credit history. If you are working towards paying off debt, credit tracking software can also calculate debt repayment schedules.

In Conclusion

Your credit score plays a big part in obtaining a loan. It is important to be mindful of the 5 most important factors that influence your score. You should always try to pay off debt on time, reduce your credit utilization, limit hard inquires, use debt consolidation, and use credit tracking software. We hope that these tips can help you take one step closer towards reaching a perfect credit score.