Things to do that will improve your credit score.


1.)  Always pay your minimum balance on time

Banks like to see that you pay your bills and debts on time.  This means paying all your credit cards, car payments, utility bills, and other debts on time.  One misconception is that your credit will improve if you put $100 on your credit card and pay it off by the month.  WRONG!!..  This tactic will neither hurt or help your credit score.  Credit scores are improved by consistently paying a debt off over a period of time.  You need to make the payments on time.  It also looks great when you pay a little extra over the minimum balance.  This shows you are doing more than the minimum payments and that you are responsible.  So, if your monthly bill is $100 then make payments of $120.  This tactic will also pay the debt down sooner as well. 

2.)  Never max out your credit card

Financial institutions want to see that you are financially responsible before they lend you money.  One way to show that you are responsible is by NOT having your credit lines maxed or close to being maxed out.  You really don't want to exceed 30% of your credit line at any given time.  This means if you have a credit limit of $1000 then have no more than $300 balance on the card at any given time.  If you are close to your credit line max or your credit line is maxed out, the banks will consider you as a high risk.  This will ultimately hurt your chances of obtaining a mortgage.

3.)  Don't sign up for new credit.

Opening a new credit line could be detrimental to you securing a mortgage.  Financial institutions do not like seeing any new credit lines.  Banks will look at credit spent as debt and will ALSO look at any credit lines that are open as potential debt. This means do NOT open any new credit lines if you are thinking of purchasing a home!!  Please keep in mind that banks not only look at the potential borrower's credit line(s) history, but also the length the credit line has been open.  The older the line of credit has been open the better.

4.)  Check to make sure your credit report is accurate

You should check in on your credit score to make sure all the information is accurate.  If there are false claims, you will have to dispute them to get them taken off of your report.  This dispute could be lengthy to resolve so the quicker you start the dispute process the better.  


5.) "Piggy-Back" on a reliable family member or friend.

Another great technique to raise your credit score is to "piggy-back".  This is when someone that has outstanding credit which pays ALL their bills, and debts on time adds you to their credit lines.  This is effective because it will raise your credit score as they make timely payments.  It is also nice to have someone else helping you increase your credit score without them financially hurting themselves.  Please note: If they don'y pay on time and their credit score drops... so will yours.

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