5 Steps to Improving Your Credit Score

Shopping for a new apartment home is an exciting time!  We have received some questions lately regarding credit scores and we thought we could shed a little light on what can be a very confusing subject.

1) Step 1, is probably the most important.  You need to check your credit score and look for any errors that may need to be corrected.  Where do you find your credit report?  You can go to www.annualcreditreport.com, this is a national government website providing free credit reports, by Federal Law.  Review your report, and check to make sure there are no late payments listed incorrectly or that the outstanding amount on your credit cards is accurate.  Do you see any cards open that you did not open?   These are all the types of information you will be able to check by seeing your credit report.  Understanding your current credit score will also help you to understand where you stand and what areas you can look to make improvement.

2)  Be sure to pay your bills on time.  Set up reminders if you have to.  This is one of the biggest factors of determining your overall credit score.

3) Try to pay down your existing debt; work to lower the balance on your credit cards or any other debt.  Although this can be a daunting task, it is extremely important.  A great first step here is to stop using your credit cards, work out a payment plan and pay down/ or off your highest percentage cards first.  However, once your cards are paid off, this does not mean to close the cards.  By keeping your cards open with a $0 balance helps your credit history.

4) Other factors that contribute to credit score is the duration of your credit history.  Since credit scores are based on a history, if you have paid your bills on time for years, well that definitely is going to help your credit score.  Unfortunately, if you have recently moved out on your own and have only been paying bills for a couple of months (even if they have been paid right on time) your score will not be as high as someone with a longer history.

5) Only apply for credit you need.  Credit scores are also partially determined by looking at your recent credit history as your need for credit.  If applying for many types of credit during a short period of time, this could mean a negative change has affected your economic circumstances.