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Quick Ways To Boost Credit Scores

11/04/2021 01:25 PM ET

Quick Ways To Boost Credit ScoresLearn how to boost your credit scores quickly. There are no shortcuts, and it might be a painstaking process, but there is a way. There are some strategies you can use that may help.

First, pay off your credit cards. This is one quick way to increase your FICO because it lowers your debt utilization ratio, which is the difference between the amount of revolving accounts that’s available to you and the amount that you’re actually using.

However, the best method to pay off revolving debt isn’t with another loan, but by paying down the debt from your current income, using cash that you have in a savings account, or selling stocks or other investments, as long as they aren’t in a retirement account.

Also, use your cards sparingly. The scoring formula rewards large gaps between your balances and your limits, and it doesn’t really matter whether you pay off those balances in full every month or not. What does matter is how much of your limits are currently in use at any given time.

A good rule of thumb, especially when attempting to boost your score, is to stay below 30% of your limits. Another “trick” that you can use to keep your balances down is simply to pay cash for most of the purchases that you make during the three months or so before you plan to take out a loan.

Lastly, focus on correcting the big mistakes on our credit report. You can boost your FICO by paying off everything that’s in collections. Not only will this provide you a quick way to increase your score.

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