A recent survey from the National Foundation for Credit Counseling indicates that more people would be embarrassed to admit their credit scores (30%) than their weight (12%).
While crash diets don’t usually work and can be unhealthy, it is possible to change your credit score fairly quickly. But just as with weight loss, “quickly” is a relative term. Seeing any improvement could take 30 to 60 days, according to Liz Weston, personal finance columnist and author of Your Credit Score, Your Money & What’s At Stake.
But nothing will change at all if you just sit there on the couch, eating Cheetos and charging items on the Home Shopping Network. So get moving!
The first thing to do is get a copy of your credit report from AnnualCreditReport.com. The three major credit reporting bureaus must give you one free copy per year, so plan to order one every four months.
Then use one or more of the following tips to boost that three-digit number that has increasing power over our everyday lives.
1. Dispute errors. Mistakes happen. You can dispute errors online through Equifax, Experian and TransUnion. After you’ve fixed any foul-ups, you might try to…
2. Negotiate. You can’t deny that you stopped paying a credit card bill when you were unemployed last year. But you can ask creditors to “erase” that debt or any account that went to collection. Write a letter offering to pay the remaining balance if the creditor will then report the account as “paid as agreed” or maybe even remove it altogether. (Note: Get the creditor to agree in writing before you make the payment.)
You might also be able to ask for a “good-will adjustment.” Suppose you were a pretty good Visa V +0.92% customer until that period of unemployment, when you made a late payment or two – which now show up on your credit report. Write a letter to Visa emphasizing your previous good history and ask that the oopsies be removed from the credit report. It could happen. And as long as you’re reading the report, you need to…
3. Check your limits. Make sure your reported credit limits are current vs. lower than they actually are. You don’t want it to look as though you’re maxing out the plastic each month. If the card issuer forgot to mention your newly bumped-up credit limit, request that this be done.
4. Get a credit card. Having one or two pieces of plastic will do good things to your score – if you don’t charge too much and if you pay your bills on time. In other words, be a responsible user of credit.
Can’t get a traditional card? Try for a secured credit card, taking care to choose one that reports to all three major credit bureaus. And if you can’t get a secured card, you might ask to… More here.