3 Things to Start Doing Immediately to Improve Your Credit Score
Tips for Repairing & Improving Your Credit Score
Your Credit Score is one of the most important numbers to ensure financial health and well-being. Your Credit report may affect your mortgage rates, credit card approvals, apartment requests, or even your job application.
1. Check Your Credit Report
You can obtain a free credit report every 12 months from each credit reporting company (TransUnion, Equifax, and Experian). Review this report carefully to make sure the information is correct and up-to-date. Your credit report contains the data used to calculate your credit score and it may contain errors. In particular, check to make sure that there are no late payments incorrectly listed for any of your accounts and that the amounts owed for each of your open accounts are correct. If you find errors on any of your reports, dispute them with the credit bureau.
2. Make On-Time Payments (Setup Payment Reminders)
Making your credit payments on time is one of the biggest contributing factors to your credit scores. Northeast Credit Union offers Bill Pay alerts through Bill Pay in online banking. Schedule a text or an email to remind you to make payments with Bill Pay Alerts, so you never forget to make a payment. See how to set up alerts. (Payment History makes up 35% to a FICO Score calculation, this category has the greatest effect on improving your scores, but past problems like missed or late payments are not easily fixed.)
3. Reduce the Amount of Debt You Owe
This is easier said than done, but reducing the amount that you owe is going to be a far more satisfying achievement than improving your credit score. The first thing you need to do is stop using your credit cards. Use your credit report to make a list of all of your accounts and then go online or check recent statements to determine how much you owe on each account and what interest rate they are charging you. Come up with a payment plan that puts most of your available budget for debt payments towards the highest interest cards first, while maintaining minimum payments on your other accounts.
Feeling overwhelmed and not sure how to get back on track? We're here to help!