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You probably have heard many commercials telling you how to raise a credit score. Unfortunately, many of those programs require you to spend a lot of money and use potentially illegal methods. Always remember that any type of financial lying can be prosecuted as a federal crime, especially when it comes to personal finance issues such as bankruptcy or credit repair. If you made mistakes in the past, only time and patience can fully erase the effects of those choices. What follows are a few free ways to legally execute the task of how to raise a credit score so you can save money in the long run. After all, poor credit increases the loan interest rates that you are charged. 1. Pay all of your accounts on time, even utility bills and other accounts that are not immediately reflected on your credit report. If you do not pay any bill on time, the creditor can turn the matter over to a collection agency or even sue you. 2. Pay more than the minimum monthly payment on any credit card accounts. Even remitting $5 above the required payment will not only help you save money on interest rates, but also help you execute the task of how to raise a credit score. 3. Rarely, if ever, apply for new credit. Each application will be reflected on your credit report for 2 years. Too many applications for new accounts can damage your credit rating; most lenders believe that people who frequently apply for credit are in financial hot water. 4. Use as little of your available credit limit as possible. If you have a Discover card with a $500 limit and owe more than $250 on the account, your credit score is suffering as a result. Ideally, you should borrow no more than about one-third of your available credit card limits. Paying down your balances will make it easier for you to get more credit at lower interest rates. No matter what any so-called expert says, do not attempt to lie to any company to execute the task of how to raise a credit score. If you really did make a late payment or had an account go into collections, it can legally impact your credit score for up to 7 years. Some events such as Chapter 7 bankruptcy will damage your credit rating for as long as a decade. However, following the aforementioned steps will still help improve your creditworthiness.
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