Life
How to raise your credit score to A+
6). Never let disputes go to collections:
Yes, your insurance should have covered that bill; no, you shouldn’t have to pay for a broadband connection that doesn’t work. But if you let commonplace problems like these escalate, your account will be turned over to collections and become a big black mark on your credit reports.
7). Pay down and spread out your debt:
More than a third of your FICO score depends on how much of your available credit you’re using. The FICO formula likes to see big gaps between your balances, whether you pay them off each month or not, and your limits, especially on credit cards. You are rewarded for paying down installment debt, such as mortgages and auto loans, but your scores improve much more dramatically when you pay down revolving debt such as credit cards. In short, it’s better to have small balances on several cards than a big balance on one card.
8). Do not let your cards gather dust.
Overloading your cards is a bad thing for your scores, but so is not using them at all. The scoring formula prefers to see accounts that are being actively used rather than sitting on a shelf. Even a little activity is better than no activity.
9). Shoot for 10%:
The less of your available credit you use, the more FICO rewards you. Keeping your credit utilization below 30% on your cards is good; getting it below 10% is even better. If you regularly use more, ask for a higher limit, spread out your charges on more than one card or make two payments every month, one just before your monthly statement closing date to lower the balance reported to the credit bureaus and a second one just before the due date to avoid late fees.
10). Apply for credit sparingly:
Applications for credit do not negatively impact your scores as much as some people fear; typically, you lose five points or less. But when every point counts, such as when you’re in the market for a mortgage or a car loan, you don’t want to squander any of your scores. Wait to apply for any other credit until you’ve secured the loan you want.
