Raise Credit Score

Have you been turned down for a loan, a mortgage or credit card? Did you ever get a loan with a higher interest rate than someone else you know that makes the same income? If so, it was probably based on your low credit score. That's the bad news.

The good news is that you can increase your credit score by doing all (or some) of the following 7 things:

1. Avoid applying for credit much too frequently.

Too many applications for credit will lower your credit score, whether or not you get the loan. Raise your credit score by minimizing the number of times you apply for credit.

2. Always pay all your bills on time.

Besides incurring needless late fees and penalties, your creditors will report your bad habits and it will result in a lower credit score. Raise your credit score by paying on time.

3. Avoid high outstanding balances.

Even if you pay your bills on time, if your credit cards are maxed out each month, this will lower your credit score. Raise your credit score by keeping balances low.

4. It's never too late to catch up on missed payments.

You will take a hit for being late, but it's not going to be as bad if you pay sooner rather than later. Raise your credit score by paying late bills now. Today.

5. Avoid closing unused accounts or credit cards.

If you have fewer sources of credit, you will not raise you credit score. The opposite will happen: your credit score will actually be calculated downward.

6. Avoid opening unnecessary accounts.

The opposite of #5 is not good either: you won't raise your credit score by increasing the number of credit cards you have. This strategy can actually lower the score.

7. Have some credit accounts in your name.

"No credit" can mean you are a credit risk. So you'll want to get 2-3 credit cards (at most) and keep the payments on them current every month. This will raise your credit score. Also - don't charge more than 50% of the credit limit on any one card per month.

You must be disciplined to raise your credit score. It won't take overnight to do it. But the better you do, the more assurance you'll have that you can save money on your loans and mortgages.