Many people struggle hard to increase their credit scores because they want to get a loan or a credit card or buy anything with an IMEI advantage. Actually, a credit score helps the lender to approve your loan and what terms and conditions are appropriate for you. But, most people do not know how to increase their credit score. If by mistake you are in their group, this article will help you increase your credit score by 100 points in 30 days.
Increasing the credit score is a matter of time; there are no shortcut ways that you can erase your credit history overnight or build up your credit score within a short time. However, there are some steps you can take to increase your credit score, and that can be fruitful for everyone.
Before you know how to increase your credit score, you need to know how a credit score works and how to calculate a credit score. So, let’s begin the journey and see the process step by step.
- How Does a Credit Score Work?
- How to Calculate Credit Score?
- How to Increase Your Credit Score?
- Bottom Line
How Does a Credit Score Work?
A credit score works when you apply for a credit card, home loan, or car loan, and your credit score measures the capability of refunding the loan. How much loan will you get, or why not by measuring your credit score.
Banks and credit unions check your credit score and credit history before they approve your loan. If your credit score is low, probably your chance is automatically low rather than a good credit score. If you’re a bad credit holder, then also you can apply for the best second chance credit card for bad credit.
How to Calculate Credit Score?
Fair Isaac Corporation (FICO) is the most popular brand that measures credit score, and most of all, banks and credit unions follow the FICO credit score when they approve loans or credit cards. Credit scores are usually three digits ranging from 300 to 850, and these scores are divided into three stages: good credit, fair credit, and bad credit.
FICO figures out the credit score considering some points that we discuss below. So please continue your reading to find out your credit score, and choose the best ways to increase your credit score by 100 points in 30 days.
Payment history stands at the most vital position with 35% of total credit score points. Which reviews whether we are making our payment on time, are we making our payment or how late, or the last time we paid our debts, etc? Lenders and banks especially check your credit history and offer the best credit cards and loans for you.
However, if you make your payment after 30 days, the creditor may report against you, which is terrible for your credit score. So you should be careful about your payments and always pay due time if you want to increase your credit score.
How Much You Owe
30% of your credit score depends on how much you owe, the credit card balance, and the loan amount. When you delay your credit card payments and loan amount does not pay on time, then your credit score will be directly affected due to this reason and your credit score tropically down.
So always try to keep your own to a minimum level, and quick debt repayment helps to enrich your credit score. On the other hand, if your credit card and loan amount are high, your credit score may increase temporarily.
Still, timely repayment of the loan and credit card arrears will create a successful payment history that is favorable for you.
Length of Your Credit History
Everyone wants to have no debt, but you have to keep in mind that the length of your credit history contributes 15% of your credit score. If you do not have a credit history, then when you apply for a credit card, home loan, or car loan banks and credit unions will get nothing to consider about your credit score. So it is wise to consider keeping your accounts open and active. Also, trying to make timely payments will help you have a healthy credit score.
New credit contributes 10% of your credit score. So it is never wise to open multiple credit accounts in a short time. This is because your recent credit accounts indirectly affect your credit score. Because when you apply for a new credit card or loan, the bank and credit union see your recent new credit activity.
The credit mix is 10% of your FICO credit score, which is evaluated on your credit cards, retail accounts, installment loans, finance company accounts, and mortgage loans. It is not necessary that you have all accounts. But you will get more benefits when you have more than one account because banks, credit unions, and lenders would like to see that you have a balance of credit mix in your account.
These are the major facts that FICO considers to measure your credit score, and you can follow up this point to grow your credit score. We will focus on some points that you can do to increase your credit score to 100 in 30 days.
How to Increase Your Credit Score?
According to recent statistics, a significant number of people want to increase their credit score, but 4 in 10 Americans have no idea how to increase their FICO credit score. Actually, credit scores provide a clear idea about your financial health.
So, the higher your credit score, the easier it will be to get your credit card, home loan, and car loan. Let’s take a look at how you can increase your credit score by 100 points in 30 days.
Get a Copy of Your Credit Report
First of all, know your FICO credit score; for that, you need to get a copy of your credit report. Your credit report will help you decide what you should and shouldn’t do. Then you can take the action that helps to increase your credit score.
Identify Negative Accounts
Negative accounts are always harmful to your credit score, so filter your credit report and determine which account has negative effects. If it is possible to stop the identified negative account affecting your credit score; otherwise, close the account.
Dispute Credit Report Errors
When you already get your credit report, please find out the negative accounts, and close them. Now the important task is to remove the credit report errors from your account. You can usually remove 10 accounts in 30 days.
Have Someone Add You As An Authorized User
If any of your friends and family members use credit cards with high credit limits, ask them to add you as an authorized user. When they add your account as an authorized one, you will get benefits for their timely payments and good credit history. In addition, they don’t need to give you access to their credit card or account number.
Use A Secured Credit Card
You can also increase your credit score by using a secure credit card. Because a secured credit card takes an amount of deposit against your credit card, and you can only deposit money. So the use of a secure credit card helps to push up your credit score within 30 days.
Pay Bills on Time
Paying bills and credit card payments on time is another essential part that increases your credit score. Always check that your credit history has no late payment because your recent credit history affects your credit score 35%.
Keep Balances Low on Your Credit Cards
Nowadays, having a credit card is a common fact, and some use more than one credit card. It is wise to keep your credit card balance low at all times. Maintain a 10 percent or less ratio on each credit line to improve your credit score. Being above the credit line can affect your credit score.
Ask for Higher Credit Limits
Ask your bank, lender, and credit union to provide you with higher credit limits so that you can get the maximum facilities. When your credit limit is high and you use a minimum level of credit, then the higher chance is to increase your credit score within a short time.
When you know your credit score and follow these steps, your credit score increases up to 100 points in 30 days. However, your credit score is already high; also, these tricks help your credit score.
A good credit history always helps you get a credit card, home loan, and car loan within a short time. So it would be best if you tried to balance your credit score, which will play an important role in building a good credit history.