5 essential ways to build and improve your credit score in 2018

A good credit score is worth more than money in America, a bad credit score keeps people from many things. Here are 5 ways to improve and maintain your score high. 

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5 Essential Ways to Build and Improve Your Credit Score in 2018 - Local Records Office

1. Pay off your debt

Because the more available credit you have, the better. To boost your score, “pay down your old balances, and keep those balances as low as possible,” says the Local Records Office.

Your credit score reflects an indication of how you manage your credit and your spending behaviors. Check your credit score at least a few months in advance before making a big purchase, (a home or a car), and regularly check your credit report.

You are allowed to one of each of your three credit bureau reports (Equifax, Experian and TransUnion) for free every year through the website AnnualCreditReport.com

You can also negotiate your bills down, and call your current subscription services to sift through the ones you forgot about or don’t need.

2. Get current on your bills

If you’re already late on a payment, pay if off as soon as possible for a quick credit boost. Even with paying off high balances every month, you still could have a high utilization ratio. Whys is this? It’s because some companies use the balance on your statement as the same reported to the collection agencies also known as the credit bureau. So even with paying your balances off in full every month, your credit score could still weigh your monthly balances.

Good debt- that debt you have taken care of and paid off- is good for your credit. The longer debt history you have with high credit debt, the better it is for your credit score.

Pay your bills on time. When planning to make a major purchase, (such as a home or a car), making that one late payment will drop your score and impact that dream deal.

Keep in mind, making risky choices could sink your credit score, two biggies are: missing payments and suddenly paying less (or charging more than you normally do), says the Local Records Office.

3. Open up a new account

When you open a new type of card, it increases your total credit line and helps your “credit mix.” And in case you have never build credit before, you can also apply to find the right secured credit card where you put in a cash deposit, and it helps you start-up. Be sure to read the fine print of upfront fees and high interest rates, and usually there is also a credit limit.

Use your calendar as a tool to help formulate a plan. Do your rate shopping as fast as possible. This can cause a slight drop in your credit score that lasts up to a year. Paying off the multiple credit cards and carrying only one or two credit cards will also help you eliminate 

“polluting you credit report with lots of balances”, says the Local Records Office.

Keep in mind that loans will allow you to make multiple applications but take out only one loan. There are three types: mortgage, auto, and more recently, student loans.

The FICO Score ignores inquiries made in the month prior to scoring. And when it finds some prior than 30 days, it will count those made within a usual shopping period as just one inquiry.

Start by comparing credit rates and ask your current company to match the lowest rate. When your company doesn’t drop your rate, you can do a balance transfer to the lower rate card.

4. Become a legit user 

Become a legit user on a responsible family member’s account will let you piggyback on the account’s excellent credit. It is just like applying for a new credit card, without the inquiry.

The credit benefits the family member or friends score, and will increase their total credit limit and raise their credit score. Just one thing to keep in mind, is when you authorize them to a card, you are at risk when they do not pay his or her bills, and your held responsible, with you credit at risk.

5. Don’t call your utilities

It’s a myth that calling utility providers and asking them to report your payment history will help boost your credit. Don’t waste your time.

Even though, you want to be cautious of making these payments on time, because when they become delinquent, they will backfire against you and your electric or phone provider may send your account to a collection agency.