Facing and Repairing Your Credit Score: Part 2

As we continue our discussion of facing and repairing your credit score, below you will find a list of items you can do to help improve your score.

• Pay bills on time and more than the minimum required balance.

• Use credit regularly, but keep the balance low compared to the limit.  It’s better to have two balances that are lower, than one that is closer to your limit. A rule of thumb is to keep the balance to credit limit at or under 35%.  If you can’t get a credit card, purchase a prepaid credit card from a reputable issuer.  This shows your ability to use a card and limit spending.

• Keep long term accounts open and limit the number of applications you apply for in a 12 month period.

• Piggybacking – or getting added as a joint account holder to accounts with good credit.  This is actually a good idea for children who will be moving to college or out in the world soon.  You have to add them as a joint account holder, not an authorized user.  This will help your child establish credit.

• Stay away from finance companies that cater to the high risk lenders.  These companies tend to offer financing at substantially higher rates and have additional fees.  An example is a company that offers cash for your title on your car.

• Monitor the progress.  Go to CreditKarma and join, it’s free.  That web site pulls the score from TransUnion for free.  It also has a cool feature that shows you what will happen to your credit score when you borrow more money.

Here is a link to the  most frequently asked questions from the  annual credit report website.

I hope this information helps you and provides you with a plan of action to tackle repairing your credit score.  If you need additional help or have more questions, please feel free to contact me.