How to Raise Your Credit Score

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Raising your credit score can have a positive impact on your economic outlook on life. Food and gas prices are on the rise again and banks have all but stopped lending money. If you have bad credit, obtaining a loan can either be extremely expensive or virtually impossible. There are, however, a few easy things you can do now to raise your credit score.

Things You Will Need

Raising your credit score take time and effort, but can be done!

Step 1

Get Current & Stay Current - The majority of your FICO score is based upon your payment history. Every time you pay a debt late, a negative indicator is placed in your credit history. It is, therefore, crucial that you get caught up on all of your bills. Once you are current, stay that way. Pay your bills on time each and every month.

Step 2

Pay Down Large Credit Card Balances - Once you know how your credit score is calculated raising your credit score becomes much easier. The major credit reporting agencies deduct points when you have balances that exceed fifty to sixty percent of a card's available credit. Paying down these high balance credit cards will free up credit and raise your credit score.

Step 3

Keep Older Cards Open - Unless your old credit cards have annual fees keep them open. Even if you have a zero balance, and plan to never use them again, it is important that you do not cancel them. Keeping them open reduces your outstanding balance to available credit ratio. If you have too much outstanding debt, combined with only a small amount of available credit, your FICO score will be much lower than it should be.

Raising your credit score is not difficult once you know how it is calculated. Follow these few, easy to implement, steps and you will be well on your way to raising your credit score.