The Credit Challenge

Just wanted to give you a quick and easy method to raise your credit score within a few days.  Many people complicate the process of raising their credit scores, and as you may know, the more complicated a thing is, the greater chance that it will never be done.

Here it is. Make sure you do it.

Call you credit card companies and ask for a higher credit limit.  Yes, that’s all you have to do.

Here’s why it works. The second category with the most impact on your credit score is your balance to credit limit, which accounts for 30% of your credit score.  The lower your balance compared to your limit, the better. 

Let’s say you have a credit card with $100 balance and a $200 limit.  You are at 50% of your credit limit, which hurts your credit score.  Again, the lower the percentage is, the better.  Once you call them and they agree to raise your credit limit to $500 for example, you have now lowered your balance to credit limit to 20%, meaning a higher credit score without lowering the balance on your card.

That’s pretty simple, isn’t it.  If you have several cards, this can really make a difference and substantially raise your credit score.

What are you waiting for, call your credit card companies!

If you want more tips like this to improve your credit score or fix your credit, click Raise Your Credit Score to get these tips sent to your email!

Understanding how credit is scored is a powerful way to establish yourself and your credit scores. Many people want to maximize their credit, however, they really don’t understand the very basics, which will hinder then when it comes to improving their credit.

The first thing that you should understand is that there are three main credit bureaus — Transunion, Experian, and Equifax — and each of these three give you a grade, or score, on your credit-worthiness according to what your creditors report to them. The creditors that typically report this credit information are for the following types of credit; mortgages, car loans, installment loans, student loans, credit card companies, collection accounts, bankruptcy and other public information, and a few others.

While each of the three credit bureaus may use slightly different variables to get to your score, the FICO scoring model is still the major credit scoring model that is used today.

What is FICO anyway? FICO stands for Fair, Isaac and Company, the group that designed the model.

According to the FICO model, here are the factors that determine your credit score:

• 35% - payment history
• 30% - amounts owed
• 15% - length of credit history
• 10% - types of credit
• 10% - new credit

Knowing this will help you make better decisions when it comes down to actions that you need to take to fix your credit score.

Knowing the components of your credit score is helpful, however, you will need your own copy of your credit report in order to start taking any action to fix your credit score. So, how do you get your hands on your own credit report?

Getting a credit report is quite simple, especially considering that you are entitled to obtain a free copy of your credit report every 12 months. However, getting your credit score can be much trickier.

Make sure any company you pay to send you your credit report is also sending you the credit score, so you know the exact number that lenders are receiving. Credit companies that give you access to your credit report typically charge extra to include your scores in your report. This is a good investment though, because you’ll know the temperature of your credit!

One service that I recommend is using Credit.com. They will send you a free copy of your credit report with your credit report with a membership. If you don’t plan on keeping your membership with them for some reason, you have to remember to cancel your membership within their 30-day period, and you only receive one of the three bureau’s reports.

Hopefully, you now have a better grasp on the importance of credit and your credit score, and knowing these facts will definitely put you ahead of the pack!