How to boost your credit score 

Boosting your credit rating matters, and aiming for a perfect score makes you a much more attractive customer to banks and other financial institutions. 

This gives you access to the most elite products, which come with much lower interest rates, saving you a load of money in the long-term! 

How your credit score is calculated

There are three major credit reporting agencies: Experian, Equifax, and TransUnion. They create your credit score and provide your report card for lending. Just like school, you are graded on how you manage your credit on a day to day basis – and how risky you are to lend to. 

The higher your score is, the more power you have in negotiations. This can be anything from renting a nicer home, getting better rates on insurance, utilities, or buying a home

Credit agencies take various factors into account when calculating your score, including: 

  • Credit utilization and amounts owed
  • Repayment history and late payments 
  • Collections and bankruptcy 
  • Types of credit
  • New credit inquiries 
  • The number of accounts held 

There is some financial information that won’t be reported, including the following: 

  • Utilities (unless you go into collections) 
  • Rent (unless you go into collections) 
  • Child support (unless you go into collections) 
  • Property and income taxes (unless you go into collections) 
  • Gym memberships 
  • City bills like parking or medical 
  • Insurance (unless you go into collections) 

However, here’s a list of what will be reported on your credit report: 

  • Any line of secured or unsecured credit 
  • Installment loans 
  • Cell phone contracts 
  • Motor vehicle loans 
  • Student loans 
  • Store credit or finance agreements 

Your payment history makes up around 35% of your total credit score, so this is the most important factor to consider. Late or missed payments can drop your score substantially. 

Credit utilization, the length of your credit history, hard credit check and new accounts opened, and diversity of credit all impact your score, as well. 

How to increase your credit score 

If you’re using Experian, credit scores can be broken down into these categories: 

  • Excellent = 781 – 850
  • Good = 661 – 780
  • Fair/ Average = 601 – 660
  • Poor = 500 – 600
  • Very Poor = 300 – 499

An estimated 61% of Americans have a score of “Good” or higher. But, if yours is lower, there are some ways to give your score a boost. 

Here are some top tips to boost your credit score quickly :

  • If you make payments to your bank, set all your payments for automatic withdrawal – this boosts your internal credit score and gives you better borrowing rates. 
  • If you can’t pay everything, always pay debts that are reported to credit agencies FIRST, then pay the rest when you can. 
  • Always have two credit building accounts  – one revolving account and one installment loan – this can be a credit card and student/car loan. 
  • Try and build two years of credit history before applying for a mortgage, as this is preferred by most lenders. 
  • If your credit limit is increased, this doesn’t mean you should spend more money. 
  • Credit bureaus only update monthly, something bi-monthly, so it may take some time for your score to be updated after making payments. 
  • Avoid late payments – most lenders don’t want late payments in the last 24 months. 
  • Pay collections your accounts first – if you want to dispute, do so later. When you pay this, make sure you get a confirmation in writing. 
  • Blemishes stay on your account for 7 years – negative credit does not fall off your account for 7 years. 
  • Try and keep your credit accounts active, even if it means spending money on everyday items then paying it back the same day.  


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