Boost your credit score

You need to have great credit to take advantage of today's lower interest rates. The following are some tips to boost your credit score.

Your credit score is incredibly important to your financial life. It determines whether you get loans, the interest rate you pay on those loans, and the terms you get for any borrowing. It can also determine whether or not you can get an apartment; it can help determine your insurance rates or premiums; employers can look at this also to determine whether or not to give you a job, or to promote you.

Because you credit score is becoming more important year after year, today you really need to know how to boost your credit score before you need a loan or a job or apartment.

So the first thing you should do if you are in the market to improve your score is to pull your credit reports. You can get copies of all three of your credit reports from the three major bureaus at one site; and that is http://AnnualCreditReport.com. Be aware that there are a lot of look-a-like sites, a lot of sites that are trying to sell you something. Your annual credit reports are FREE. You can get, as said, each one from AnnualCreditReport.com.

Once you get copies of your credit report, go through it and look for serious errors. Now a serious error is not simply an old address being listed or a slight misspelling of your name or a variation of your name. A serious error is something like an account that isn't yours, a negative mark or a late payment or default that is on your report. These can remain on your report for seven years. A bankruptcy will remain there for 10 years. Those items will drop off after that period of time - the 7 or 10 years.

You also want to look to see how many inquiries are on there. That's not necessarily a huge negative, but you want to see who is checking up on you and on your credit. Once you have been through your credit report, if you find serious mistakes, go ahead and dispute them.

When you get your reports online (via AnnualCreditReport.com) you will see a little button that you can push to dispute various items on your credit report with the reason why; then wait to hear back from the credit bureaus. Sometimes the process is very easy and those negative marks are taken off. Other times the creditor or lender will actually say this is the truth; so, you will have to take your fight up with the creditor or the lender. If you wind up in a situation where your creditor will not back down, you might consider hiring an attorney just to write a letter. Sometimes spending a couple hundred bucks on an attorney is better than spending thousands of dollars in extra interest payments, because of mistakes.

The next thing you will want to do to improve your score is look at how you are using your credit cards. It is very important to keep your balances well below your credit limits. You want to use 30% or less of your available credit limit at any point in time.

And remember that the credit bureau(s), your credit reports, and your credit scores, don't really distinguish between balances you pay off every month and balances your carry every month. What it looks at is the balance reported by the creditor the last time around (usually the last month, the balance that was on your last statement). So, you want to make sure you are not maxing out your card, even if you are paying them off in full every month. You want to keep it to 30% or less. Now, if you really want to see a boost in your scores, get that credit utilization down below 10%. That does the maximum good for your score.

A couple of other things you should consider when trying to improve your credit scores is that closing accounts can never help your score, and it may hurt it. This is not the time to go around closing retail accounts, or major credit card accounts. Leave your accounts open, at least for now, until your credit score is where you want it.

Another thing to keep in mind is that you shouldn't be opening new accounts. Or you should be very careful about the new account you open. Every time you open a new account, you risk damaging your scores. So, make sure you get your score up, and you get the major loan that you are after, like a mortgage or auto loan before you open any new accounts. Those are some ideas to help you boost your credit score, and get the credit you deserve.