Quick Tricks for Improving Your Credit Health

Quick Tricks for Improving Your Credit Health

Your credit health is kind of like your physical health--there's no fast lane to a perfect credit score or perfect health; it's a long-term journey. But just as you can begin making healthy diet and exercise choices today, you can do the same for your credit.

Here are a few things you can try right now to boost your credit health.

Task: Ask for a higher credit limit.

Possible benefit: Lowers your credit card utilization.
Time: 10 minutes
Tactic: Calling up your credit card company might seem like a daunting task, but if it could help your credit health, shouldn't you do it? Most companies review credit limits on an every-six-months basis. If it's been a while since you've received a credit limit increase, you can try requesting one.

First of all, know that this tactic will likely only work if you've had an excellent record with your credit card company. Find your creditor's phone number on your latest statement or by searching online. Call them up and get an agent on the phone. Once you're talking to someone, tell them how good of a customer you've been, how you've always made your payments on time, and how you've enjoyed using the card. After this initial framework, tell them that you'd like to request a credit limit increase.

Watch out for: Sometimes, credit limit increase requests can come with a new hard inquiry to your credit. Make sure to ask first if this will happen so that you know what to expect and if you'd still like to go through with your request.

Task: Write a "Goodwill adjustment letter" for a past late payment.

Possible benefit: Removes a late payment from an otherwise good-looking credit report.
Time: 15 minutes
Tactic: If you've recently made a late bill payment when you're ordinarily on top of things, asking to have that one, small black mark removed could work for you. In your letter, you'll make a case for why the delinquency should be removed. Show what a loyal customer you've been and how much you've improved your financial situation since this one mistake. Model your letter after this example and wait about 30 days before following up, if you haven't heard anything.

Watch out for: Remember that your credit card company doesn't have to remove the delinquency, so be prepared for that instance.

Task: Make a plan to pay down your credit card debt at a faster rate.

Possible benefit: Lowers your credit card utilization.
Time: 30 minutes to an hour
Tactic: If you tend to carry balances on your credit cards from month to month, work out a plan to pay down your debts faster so you can get your credit card utilization rate to lower than 30 percent--that's the rate that credit experts recommend.

First, see where you stand by checking out your current rate. Then, see your rate on individual cards in your My Accounts section. For the cards reporting more than 30 percent, work on those first. If you've only been making the minimum payments on those cards, increase that repayment rate so you can steadily decrease your utilization rate.

Watch out for: While you're working on lowering your balances, avoid relying too heavily on your credit cards. Otherwise, you'll just reverse all of your hard repayment work.

Task: Transfer your credit card balances.

Possible benefit: Strengthens your debt pay-off plan and increases your total number of accounts.
Time: 15 minutes (then 7 to 10 days, typically)
Tactic: When you have lots of different credit cards with varying balances to repay, making multiple payments each month can seem tricky. There are several cards that offer introductory balance transfer rates, meaning if you transfer all or some of your other cards' balances, you won't pay any interest on those balances for a year or two. These promotions vary by card, so always review the terms carefully with a representative. If you're interested in opening a balance transfer card, our partners have many offerings -- find out how to pick the right card for you first.

Watch out for: In most cases, if you don't pay off your balance transfer completely during the introductory period, you'll have to pay interest on the entire transferred amount when that period is up. So this tactic is good for you if you're really ready to tackle your credit card debt.

Task: Get rid of credit report errors.

Possible benefit: Gives you a more accurate record of your credit history.
Time: 1 hour (then up to 30 days)
Tactic: While some credit report errors don't affect your credit score at all (like inaccuracies in your personal information), others can severely impact your ability to get approved for credit (like inaccurate derogatory marks). Bottom line: Cleaning up your credit report should be a top priority. Use this step-by-step guide to help you through the process of cleaning up your reports.

Watch out for: While some credit repair companies will tell you they can remove all negative information from your credit report through this process, that's simply not true. Accurate negative items on your report cannot be removed. Before you hire a company to help you dispute your credit report errors, read through our blog post on how to spot a credit repair scam.

Editorial Note: The editorial content on this site is not provided by the bank or issuer. Opinions expressed here are author's alone, not those of the bank or issuer, and have not been reviewed, approved or otherwise endorsed by the bank or issuer. Credit Karma may be compensated by companies mentioned through advertising, affiliate programs or otherwise. It is this compensation that enables Credit Karma to provide its members with services like free access to your credit scores and free monitoring of credit and financial accounts at no charge.

 

Disclaimer: All information posted to this site was accurate at the time of its initial publication. Efforts have been made to keep the content up to date and accurate. However, Credit Karma does not make any guarantees about the accuracy or completeness of the information provided. For complete details of any products mentioned, visit bank or issuer website.

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2 Contributions
453 People Helped

Helpful to 453 out of 481 people

Last year in October my husband lost his job. With this happening right before all the holidays and me being recently employed for only three months after graduating college put us behind on all our bills, mortgage, Insurance payments etc..... I made the mistake of taking out three different payday loans to cover all our bills and cover christmas for our children. With repaying at 495% interest on those loans, which none of the principle part of my payments to the loans was being applied to, sunk me even deeper into debt. I started with a 720 credit score and due to defaulting on the loans, my home, which is now foreclosed and being removed off my property on January 1st 2014 (Mobile Home),  my credit score is 550. I just new I would not qualify for any loan with that score and my history but I applied for approval on a new mobile home and qualified through what is called a chatel loan for people with very poor credit. The place I went to purchase the home from is ran by real estate agents and brokers, they offered to help build my credit with my down payment of $675 promising at least a 30 to 60 point increase on my credit score. They recommended I dispute all the negative items listed on my report to the companies reporting them. The companies then have thirty days to respond to the dispute. If they dont, the negative report has to be removed from your credit history. You keep doing the disputes over and over and eventually you may not get the 30day required responce. Also a secured credit card helps jump up your credit score. The recomendation is to only charge 20 to 30 dollars on the card and pay off that balance immediatly and not wait to pay the minimum on the due date. this significantly increases the points on your score. I just started 6 weeks ago and went from a 550 to a 584. Hope this helps:)

Reply by
DelgadoS

2 Contributions
29 People Helped
Helpful to 28 out of 30 people

Recently I applied for credit in a store, that is the only one that will give me credit. I use it just for using it, in small amounts, and pay at end of month, it has bumped up my credit substancially, opened a second one and did the same. It is working wonderfully. Now i will open a secured line, need 3 open, good  credits in order to make the credit better, if you dont owe, you dont have credit. Sadly, thats the way it works

Reply by
padavano

1 Contribution
33 People Helped
Helpful to 33 out of 38 people

I am going to follow your advice! Thanks!

5 Contributions
330 People Helped

Helpful to 246 out of 278 people

I actually work in customer service for a major credit card company and I just want to make a comment on this article. The article states: 

"Call them up and get an agent on the phone. Once you're talking to someone, tell them how good of a customer you've been, how you've always made your payments on time, and how you've enjoyed using the card. After this initial framework, tell them that you'd like to request a credit limit increase."

This is actually pointless and can make the call kind of awkward. The representative really has nothing to do with whether your credit line increase is approved or denied. This is actually all automated. The representative enters your financail information into the computer and the computer is either A. Automatically approve you or B. Send you a letter of "Adverse Action" telling you were denied and give you the reason. 

Really this is how most things are done at credit card companies. Including being approved for a credit card, credit line increases, and even fee reversals (such as late fees-based on previous fee reversals and how profitable the account is). 

Reply by
LabRockett

2 Contributions
86 People Helped
Helpful to 65 out of 79 people

but it is always nice to be pleasant to whom ever you deal with in life.

2 Contributions
26 People Helped

Helpful to 25 out of 26 people

If anyone on here is asking for you to sign up or pay for helping you with your credit, you are asking for trouble.  They are not only spamming us here but could also be phishing for suckers to steal from.  All it takes is a little letter of dispute and sometimes only a short call to all three credit bureaus to fix simple credit discrepancies.  Don't be lazy, don't hire someone to do this for you - do it yourself.

5 Contributions
330 People Helped

Helpful to 82 out of 96 people

Most likely, any response you get to a letter of reconsideration is going to be the same answer just worded differently. I honestly have mixed feelings about where I work. I do love my company but I don't like how cold it can be sometimes. Credit card companies are actually quite cold. And when I say cold, I don't mean that the people that actually work there are cold but the way the system is set up is cold. Big credit card companies are not like your small town bank. Nothing is really personal. The people who work there are really more like script readers. All the answers you get are cut and dry, there is no exception (unless you go up the chain of command-the further you go the more you can get done...sometimes..) 

If you want that small town feeling, go with a local bank or credit union. But, I also want to give you a tip. MANY small banks and credit unions hire these large companies to manager their credit cards. For example, my company manages credit card accounts for about 1,200 different financial institutions. So, READ THE FINE PRINT and see who is going to actually be managing the account. Make sure it really is indeed your bank/CU. (You may be able to just ask a teller or banker.)

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