14 Feb Do This, Not That to Fix Your Credit In 3 Months or Less
Frequent travelers know that a travel rewards credit card is essential for earning miles or points towards free flights and hotel stays. Qualifying for a travel rewards card that offers premium perks often requires an excellent credit score.
If your credit rating falls short, however, an upper tier rewards card might be out of reach. But, that doesn’t mean you have to postpone your travel plans. You can turn a low score around in a relatively short time with these simple tips.
Do pinpoint what’s hurting your score
Some things can drag your score down more than others. Late payments, for example, can deliver a significant wallop to your credit. Knowing what’s working against you can help you figure out what to do about it.
Check your free credit score with Credit Sesame. It’s free to create a member account and when you sign up, you get not only your credit score but a break down of the factors that are helping (or hurting) your credit.
If late payments are a problem, for example, setting up payment reminders or automatic payments for your bills is a relatively easy fix. If your score is low because you’re using up a lot of your available credit, paying down some of your balances can help add points back to your score.
Do consider paying off old collections
If you’ve slipped up and let an unpaid debt go to collections, paying it off could boost your score, especially if it’s a medical bill. Under new credit scoring models, medical collections don’t factor into how your score is calculated if you pay them in full. The accounts can still stay on your credit for up to seven years but if they’re paid, you may see an improvement in your score within the next 30 days.
And if you don’t have collection accounts but you’re late on one or two of your bills, get these caught up as quickly as possible.
Don’t close down on old accounts
Your credit age is one of the factors that makes up your credit score. Having older accounts on your credit report can help your score, so if you’re looking for a quick credit fix, be sure to keep them open. In fact, consider asking for a credit limit increase on your oldest accounts, which could raise your score in as little as a month.
Don’t open new lines of credit unless you absolutely need to
Each time you apply for a loan or a credit card, the inquiry shows up on your credit report. Inquiries can knock up to five points off your score each time. If you’re working on raising your score fairly quickly, resist the urge to open any new credit accounts.
If you have to open a new credit card — because you want to transfer a balance to a card with a lower APR, for example — head to Credit Sesame and login to your dashboard to get recommendations on which cards are best for you.