Credit Repair

Learn How to Improve Your Credit Score

how to improve your credit score

It doesn't take complex strategies to improve your credit score. You don't need to hire a company to do it for you. In fact, the bigger the claims they make–we can improve your credit in 48 hours!–the more skeptical you ought to be.

Improving your credit score is actually pretty straightforward, but it does take time. So have a little patience and try these five super simple strategies to improve your credit score.

#1: Pay your bills on time

It doesn't get any simpler than this. And pay attention to all of your bills, not just the credit card bills. Taking this step is like building the foundation of a house. Do this with care and everything else you "build" on top of it gets you closer to a great credit score.

If you're having problems remembering to pay bills, then set up automatic payments. Or go to the home page for your credit card and see if there's an option to set up reminders to pay your bill. And if you use an automated money management program like Mint, you can get payment alerts sent to your inbox or text reminders sent to your smart phone.

#2: Check your credit reports for errors

This is an oldie, but a goodie. You've heard this before, but that's because it's a necessary–and possibly rewarding–thing to do. If you find an error that is significant enough to lower your score, you've hit the jackpot. Of course, all errors should be fixed, but if you have one that's affecting your score, then you might get a boost and improve your credit score shortly after the error is removed.

You're entitled to a free credit report from each credit bureau every 12 months and you can request them at You can get all three at one time or spread them out over the course of a year. Or you can check your credit and score every month for free (it only takes a few seconds once you get set up) at, and you can track your score as it improves over time. If you find an error, follow the steps on the Federal Trade Commission website: Disputing Errors on Credit Reports.

#3: Know your current credit score

You have a few choices when it comes to getting your credit score. You can get a FICO score on for about $20. This will be the closest approximation to the score used by 90 percent of lenders. But even then, your score won't necessarily be the exact score seen by a lender. When a lender requests your score, the calculation is based on the credit information that is available at that moment in time, and which product the lender is using (one consumer can actually have close to 50 credit scores, and most of them are not the "educational" one you can purchase).

It does, though, give you an excellent idea of where your credit stands. You're unlikely to drop from good to fair credit in a couple of weeks unless something major has happened with your accounts.

Check out LendingTree's free credit score to find out what your credit score is. And you also get grades on each of the factors that are considered by the credit score used. This information is valuable because you'll know what to focus on to improve your credit score. It's simple, fast, and best of all, it's free.

#4: Keep low balances on credit cards

The idea here is to use a small amount of your available credit. Pay your credit card bill on time –hopefully, the full balance due–and keep your utilization ratio under 30 percent. If your ratio is higher than 30 percent, you can lose points from your credit score.

Here's an example: You have a credit card with a $4,000 credit limit. If have a $2,000 balance, then you have a utilization ratio of 50 percent (2,000 / 4,000 = .50, or 50 percent). This is way too high!

Now, if you have a balance of $1,000, then your utilization ratio is 25 percent (1,000 / 4,000 = .25, or 25 percent), which is good because it's under 30 percent. But if you want to improve your credit score as quickly as possible, keep a balance below $400 (400 / 4,000 = .10, or 10 percent).

#5: Make two payments per month

If you're having trouble keeping low balances, then outsmart the credit score by paying your credit card bill twice in one month. Credit card companies usually report your balance shortly after the closing date on the statement, but call your credit card company and confirm the day of the month they report your payment activity to the bureaus.

There can be timing issues with your credit card payment and the issuer's reporting date. So even if you pay your bill in full every month, the amount reported might not reflect your most recent payment. It's a snapshot of that point in time. So you could appear to have a high ratio even though you know your account has a zero balance.

The solution? Make a payment right before the reporting date to reduce the balance that is reported to the bureaus. And then make another payment sometime during the month, such as right before your due date if it isn't too close to the closing date.

Some folks even send a payment the day after they use a credit card to make a big purchase. This has the advantage of making sure they don't have a high utilization ratio when the card company reports to the bureaus. It also helps them stay out of debt. It can be easy to make a big purchase and then forget about it until the bill arrives. If your cash flow is tight, you might have to carry a balance. By paying for the big item right away, you lower the possibility of that happening.

You can even make a payment every week if you want. Whatever approach you choose, just make sure you cover the minimum payment due for the month. A late payment can mess up all the hard work you've put into improving your credit score.