How Can I Raise My Credit Score in the Next 30 Days?
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People often realize that they need to raise their credit scores when they are getting ready to get a loan. They might be buying a house, or maybe they need a new car. They may not be able to plan it ahead of time, and suddenly, they need to raise their scores within 30 days. You may wonder if this is possible. It is possible as long as you understand how the score is calculated.
What Is in a Credit Report?
To understand how to raise your score in 30 days, you need to know what is in your credit report and how they use the information to calculate your credit score. The first thing you need to do is order a free credit report. You are entitled to have a copy and know exactly what is in there.
When you look at your credit report, you will notice that it is divided into different sections. The first section has personal information such as your name, any other names that you may have used, your address, your phone number, and your employment history. You should check it over and make sure that everything is accurate and spelled correctly.
In the next section, you will find any legal financial information, such as items that are a result of lawsuits. You might find bankruptcies, liens, judgments, and wage garnishments here. This information should also be accurate.
The third section contains your creditor information. You will find your credit cards, your auto loans, mortgages, and student loans. Each creditor will list the amount you owe, the original amount, the credit limit, and your payment history. If you have any charged off credit cards, they will also appear in this section. It is very important that everything is accurate here as well.
You will also find any credit you have applied for in the past two years, and you want to keep those to a minimum. This is the bulk of the important information in your credit report, and credit bureaus use it to calculate your credit score.
How Is a Credit Score Calculated?
When the three credit bureaus, Experian, Equifax, and Transunion, calculate your credit score, they look at a number of different factors within your credit report. The impact of these items breaks down in the following way:
- Your payment history (35% of score)
- Your credit usage (30% of score)
- The length of your credit history (15% of your score)
- The type of credit you have (10% of your score)
- Credit inquiries (10% of your score)
As you can see, your payment history and your credit usage make up a significant part of your score, at 65%. It is extremely important to pay your bills on time and to keep your credit usage as low as possible.
How to Raise Your Credit Score Quickly
After you review your credit report, you need to make sure that you do not have any late payments. If you do, you need to catch that account up right away. Not only will continuing to pay the bill late have an ongoing impact on your credit score, but as you progress from 30 days late to 60 days late, the impact is greater.
Credit bureaus want to see your credit usage under 30% of your available credit. Paying those balances down will increase your score right away. Although your score will rise if you pay the balances down to 30%, they will rise further if you can pay them down more. Pay your balances down as much as possible to get the largest boost to your credit score.
If you are unable to pay down your balances, you should consider opening a new credit card. You should not view this as an opportunity to increase your spending; you are raising your available credit so that your credit usage is lower. You might consider using the card once a month for gas or another mandatory purchase, but make sure that you pay it off.
If you are not able to obtain a credit card, you can look at secured credit cards. You will make a deposit, and your credit limit will be the amount of your deposit. You will receive and pay a bill every month, so you have an excellent opportunity to build credit this way.
Finally, you can sign up for Experian Boost. You will ask Experian to use your on-time payments to utility companies and your cell phone to boost your credit score. You have nothing to lose because late payments do not factor in. If you have paid your bills on time and sign up for this service, your score will receive a boost right away.
Paying your bills on time and keeping your credit utilization under 30% of your available credit will help to raise your score quickly.
Inaccurate Information on Your Credit Report
Another way to improve your credit score is by having any inaccurate information removed from your credit report. A surprisingly large number of people find items in their credit reports that should not be there, including the following:
- Duplicate accounts
- Inaccurate accounts
- Accounts that don’t belong to you
- Incorrect inquiries
- Inaccurate address or name
There are laws and regulations that govern your rights concerning your credit, and the law dictates that the information must be accurate, verifiable, and timely. This means that the balances on your credit report should be exactly what you owe, and the debts should belong to you. You have the right to dispute any information that doesn’t belong there, and the credit bureau must verify it, correct it, or remove it from your credit report.
What Is a Credit Repair Company?
If you are uncomfortable filing a dispute yourself, you can enlist the services of a credit repair company. These companies have years of experience helping people dispute inaccurate information on their credit reports.
They will order copies of your credit report from all three credit bureaus because the same creditors do not report to all three. They will review this information and point out any potentially inaccurate information. You can also review the reports and tell them what doesn’t belong there.
The credit repair company will tell you what documentation they need to dispute the information, and they will file the dispute on your behalf. This process may take more than the 30 days, but the items you are disputing will show up on your credit report as “in dispute,” and you can explain the situation to the creditor you wish to receive credit from.
If these negative items are removed from your credit report, your score will increase. It is important to understand that a credit repair company can only help you dispute inaccurate information. Any valid information whether late payments or charged off debt is not something that they can dispute for you.
How to Know If a Credit Repair Company Is Legitimate
If you decide to use a credit repair company, it is important that they are reputable and that they do not have any customer complaints. There are several signs to look for when you hire one of these companies.
They should not charge you for their services before they do the work. They cannot guarantee that they will have the items removed, and you shouldn’t have to pay them if they are not able to successfully dispute invalid items on your report.
In addition, they should let you know that you have the option of disputing the debts on your own. They should not guarantee a specific score increase, and they should never dispute valid debt or ask you to lie. Any of these items are a red flag that tells you that this company should be avoided.
A good credit repair company will offer you a free consultation, and they will let you know what they can dispute. They will have a track record backed up with customer reviews, and you should have confidence before you agree to anything. A good credit repair company can simplify the process of disputing invalid items on your credit report.
How Long Does Bad Credit Stay on a Credit Report?
Generally speaking, bad credit will stay on your credit report for seven years. There are exceptions; a collections account stays on your report for seven years and another 180 days, and bankruptcies other than Chapter 13 stay for 10 years from the date of filing. However, the following will remain for seven years:
- Late payments
- Short sales
- Charge offs
- Tax liens (from the date of the payment)
- Chapter 13 bankruptcy
The longer it has been since the negative item happened, the less impact it will have on your credit score. Your score suffers the most for the first two years. If you went through a life event, such as a divorce or a major illness, you should make a note to your credit file. This can help creditors see the entire picture.
Other Ways to Raise Your Credit Score
When you look at your derogatory items, you should look to see if any of them carry a balance. If so, you may be able to negotiate a deal. For example, you can call a collection company, and offer to settle the debt for less. The key is to get a contract in writing, and tell them that you will pay the debt if they agree to remove the item from your credit report. Do not agree to pay anything until you have a written contract.
If you have a thin credit file, you might consider diversifying your credit. For example, you may be able to open a line of credit from your bank if you have a history with them. You can use this line of credit to pay down your balances and extend your available credit. Having a mix of different types of credit will boost your score.
In addition, you should not apply for a number of different credit options all at the same time. Even though you might want to apply for a credit card or a line of credit, don’t randomly apply to a lot of different companies. Credit inquiries only make up 10% of your score, but when they see you applying for a lot of credit at the same time, it makes them nervous that you need the money.
What Is an Authorized User?
Another way that you can raise your credit score quickly is by becoming an authorized user on someone else’s account. If you have a family member who has excellent credit, you can ask them to add you to the account. It is very important to understand that anything you do will impact this person’s credit, so be very responsible.
If you use the card, make sure that you pay the money right away. Another great thing about this is that it will increase your available credit, and that is why your score will go up right away.
If you want to dispute inaccurate items on your credit report, we can help. We have years of experience helping our clients dispute mistakes and have them removed from their credit reports. Although you can dispute these items on your own, we can facilitate the process because we know what kind of information you need.
After you decrease your overall credit utilization and make sure that your payments are on time, you should dispute anything that is invalid on your credit report. You can become an authorized user, sign up for Experian Boost, and try to open an additional credit card or line of credit. All of these things will increase your credit score.
Finally, if you have derogatory marks on your credit report, you should consider adding a note to your file. If the negative items are the result of a life event such as a divorce or an illness, you can add that to your file so that creditors understand that you went through something, but now things have improved.
Ready to take your Credit to the
Ready to take your Credit to the