How to Boost Up Your Credit Scores?

| November 30, 2011 | 0 Comments
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Credit scores tend to reflect your creditworthiness by revealing a true picture of your credit history. This implies that you should continuously try to increase and maintain your credit scores. Since it is a time taking process many people do not even think about it until it becomes a problem for them. Thus, you should constantly attempt to increase your credit scores so that whenever you need credit you can avail it at good interest rates.

Credit score, commonly known as FIFO score is calculated mathematically using information from your credit report. Having a high credit score not only qualifies you for a loan but also offers the best interest rates by reducing the lender’s risk. Following are some of the important tips that you must keep in mind in order to increase and maintain your credit score.

Make Payments in Time

The very basic and simple thing to start off with is to make your payments in time. You must avoid delinquent payments as they tend to damage your credit scores. Once you start working on this simple advice, you will surely see the results within a month.

Lower Your Credit Card Balances

Secondly, try and keep the balances of your credit cards low so that they do not max out and lower your credit score. One way to do this is to make sure that your credit card balances do not exceed 25% of their credit limits.

Avoid Closing Old Accounts

Thirdly, you should not close your old accounts because shutting them down will shorten your credit history and thus lower your credit worthiness. This may also reduce the amount of total credit that is available to your by changing the debt utilization ratio.

Acquire Debt in Small Amounts

Another quick way of increasing your credit score is to acquire debt in the form of small loans in order to build up your credit history, which you can later on present to the lenders to show that your are a good borrower.

Search Quickly For the Best Interest Rates

Moreover, your credit score can be lowered whenever you apply for a loan. Therefore it is recommended that you search for the best interest rates as quickly as possible, so that while calculating your credit score all your credit report inquiries are treated as a single request.

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Category: Blog, Improving Credit Score

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