Increase My Credit Score
We Tell You How

Reading and following the tips presented here on our 'increase my credit score' page will over time improve your credit score and in so doing get you better terms on debt, lower interest rate offers on credit cards or auto loans, and speed up your loan application processing.

Just like in many other endeavors in life it is very easy to destroy but far more difficult to build. This axiom certainly applies to your credit score. There are things you could do that would lower your credit score rapidly, but really nothing you can do to raise the score fast. This process will take time and effort from you.

The Fair Isaac Company with their FICO® score is the leader in credit score generation with a U.S. market share topping 90%. The tips and techniques listed here to 'increase my credit score' are specifically focused on them.

Your credit score is derived by making a complex mathematical calculation after taking a snapshot of five parts of your financial life delivered to Fair Isaac from one of the three credit reporting agencies.

Don't get confused between a credit report and a credit score. The three big credit reporting companies, Equifax, Experian, and TransUnion generate credit reports. Fair Isaac takes the data in those reports and generates your credit score.

According to the Free Credit Reporting Act you are entitled to a free copy of your credit report from each of the three national credit reporting companies. Your numeric credit score is not part of these reports, however you can get your FICO credit score here.

Anatomy of a Credit Score

• Your payment history accounts for about 35% of the overall score.
• The amount of money you owe on each credit or loan account as well as the overall total of monies owed plays a 30% roll in your score.
• The length of time you've had open credit accounts has a value of 15% in your credit score.
• New credit accounts, how long they’ve been open, and certain other new credit inquires count for 10% of the total score.
• The mix of credit you have, like having a credit card, an auto loan, and a mortgage, make up the last 10% of your score.

To improve your credit score you will need to make changes to these parts of your credit profile. You can do this by following our 'increase my credit score' steps listed here for each particular category.

Improve Your Payment History

There are a number of things you can do to improve your payment history. The most important is to make payments for all tracked loans on-time. Loans tracked as part of your payment history include those associated with any credit cards, auto loans, store or other retail accounts, any installment loans, finance company accounts, and of course, mortgages. If you miss a payment don't fret, just get current and stay up-to-date on payments. The passage of time will make any late payment you've made in the past have less negative value on your score.

Amount Owed

Besides actually paying down debt, which is the number one way to improve this portion of your credit score, there are some items related to the amount you owe on each of your accounts and your total overall debt that you may want to do and others you definitely don't want to do. First off, you should keep your monthly balances low on any revolving accounts like credit cards. You should also avoid moving debt around, it is far better to pay it off. Closing old paid-off accounts in an attempt to spread your overall debt over fewer accounts can actually hurt your score, so don’t do it. Also, don't open more accounts than you actually need and use.

Credit History

If you are just out of college and new to building a credit history don’t open lots of new accounts too quickly as this can average down your length of credit history very quickly and hurt our credit score. Instead, open one or two accounts that you need, not want, and let some time pass. In about six months this should have move your credit score up a bit. Older individuals, simply by having a longer credit history will add to their scores.

New Credit

If you know you’ll need more than one loan in the near future you should shop for all the loans at the same time or over a very short time period. You can avoid be penalized for searching out lots of new credit this way. No matter what you should not open any kind of account you don't need, each new account opening can lower your credit score over the short term. Over the long-term opening new account as needed, handling them properly, and paying on-time will increase your credit score. Requesting you own credit report will not have an adverse affect on you credit score.

Types of Credit

Having and responsibly handling a credit card, auto loan, and mortgage will increase your credit score. A good mix of different kinds of credit combined with your ability to pay them on-time lowers your risk as a borrower in the eyes of creditors and for this reason will increase your credit score.

Increase My Credit Score

Following our tips on how to 'increase my credit score' will work to raise your credit score over time. Knowing where you stand with your credit reports and credit score should be part of your personal finance management plan. Your goal should be to get your credit score above the magical 720 mark where all the best deals and lowest interest rates live.