Best Online Credit Check

You might feel a little anxious these days if you have been seeing your credit scores steadily decline. Although that may be expected if you have had financial difficulty recently, you may be shocked to learn that your low credit scores may not be solely your fault.

Fair Isaac decided to alter their FICO scoring system recently for the first time in decades. As employers cut back during this dismal present economy, you may have found your annual raises or bonuses have all but evaporated. The credit card companies are currently cutting credit limits and closing accounts to limit their exposure during uncertain economic times. All of these factors have common ground when it comes to your personal credit. There is nothing you can do about them and they all can negatively affect your credit score.

However, you should know that raising your scores, while challenging, still involves good money management and paying attention to your credit history (something any motivated person can accomplish). Of course, you first step should be to get a copy of your credit report to see exactly where you stand. You can easily request them from the credit bureaus or annualcreditreport.com. But, in fact, there are three methods you can implement right now to improve FICO scores and repair your credit even without your report:

Start Improving Your Payment History

Your payment history makes up approximately 35% of your total credit score and is the primary factor that all your future lenders will start analyzing. In other words, you are almost guaranteed a rejection on future loans if your credit history contains numerous late payment entries, even if you write pages of good credit references on your loan application. So, your first priority will be to begin paying your monthly bills on time if you are not already. Remember, even some of your utilities may report to the credit bureaus these days, so you’ll want to focus on prompt payments each month. No exceptions.

Start Improving Your Debt To Credit Ratio

You can increase your FICO scores by almost one-third (30%) simply by keeping the amount of debt you hold at a low amount compared to your credit limits. If you use credit moderately and responsibly by not exceeding 10%-30% of your total credit limits, potential lenders will take notice. For example, if you have a credit card with a $1000 limit, use it regularly without exceeding $300 per month.

Basically, potential lenders want to see activity without a dependence on credit. So, if you can discipline yourself to use credit sparingly but often, you stand a better chance at keeping your accounts open and constantly improving your credit history.

Improve Your Credit History

We have just discussed using credit in moderation to improve your credit history, as well as making timely bill payments. However, this last method to improve FICO scores may be a little surprising. Don’t close your old accounts. That’s right, keep them open.

If you have older accounts you are still paying on, leave them alone even if you have had a few problems with them in the past. Closing old accounts with reckless abandon can make your credit history appear much shorter and ultimately hurt your credit score. So, don’t touch.

You will want to always pay close attention to your personal credit history as it comprises another 15% of your total credit score. In a nutshell, it’s best to go ahead and get your report. Then sit down and make an informed, comprehensive plan of attack before blindly jumping into credit repair.

Attempting to improve FICO scores may not be as easy or straight-forward to do as it once was, but you can achieve it in less time than you may think if you remain determined. And finally taking control over your finances can not only be rewarding and satisfying, but it will utlimately bring you a more successful life in general as you now qualify for the home and auto loans you really want.