You can’t get a high credit score overnight but there are certain things that you can do to that will raise your score in small increments to where you want it to be at eventually. The first action that you can take if you are just beginning your credit history is to open a line of credit. It does not have to be a high limit on your card in order to get the benefits out of having it and raising your credit score rating. It is actually better for you to have a small limit rather than a large limit on your card even. This makes sure that you do not overspend so that you will be able to pay off your card on the very first billing period.
Okay back to scoring a high credit score. Start with small purchases or necessary purchases in small quantities. You should try to keep the spending in line even during this period so that you can do what I recommended above about being able to pay off the credit card bill in one billing cycle. Every time you pay off your credit card bill or another line of credit that you have open including your mortgage or car payment your credit score is impacted positively. It is the start of establishing a positive and good credit score on your way to scoring a high credit score. Then you should continue to use your card once a month or more if you can afford to pay it off each time the monthly bill comes in without impacting your other budgetary necessities like rent, car insurance, food, electricity and gas.
This will start to raise your credit score rating in the three credit agencies that monitor your credit history. Your credit card company might also notice and ask if you want an increase in your credit line. That is a good thing if they ask this it means they know you are paying on time and they are reporting it to the bureaus that you are paying it off in full each month. However, you should not be tempted to increase your credit line just now, unless you have an emergency that came up that you need the credit line for at the time or if your limit is so low like around $100. It is okay to tell your credit card company no, or that you only want it rose to a certain amount, a good example is to only raise it to $500 this first time or even less money. If you raise it to high you might be too tempted to overspend and then you will have trouble paying it off at the end of the billing cycle. You do not want that to happen as that will start to decrease your credit score rating if you miss any payments or it will stall at the point where you are at until you get caught up with the bills being paid off in full.
You can still pay off your balance without paying it in full but it might take longer to reach that high credit score that you are trying to achieve. Your credit will be still building and going up but it will just take longer.
You should also keep in mind scoring a high credit score can happen quicker if you are paying all your credit lines each month in the amounts that are due for mortgage and car payments or more money than what is on the bills. The same rule applies for these types of loans as it does with the credit card(s) to raise your credit score rating. That is making the payments in a timely manner either on or before the due dates of each of your other credit lines that will increase your credit score and if you do this with every credit line you have open scoring a high credit score will be a piece of cake for you. It will take some time if you just have one line of credit over having more than one credit line to increase your credit score.
So the next question you are probably asking is should I open another credit line or credit card?
The answer depends on if you can afford more than one credit payment every month. You should also keep in mind that if an emergency happens and you miss a payment it will reflect negatively on your credit score rating before you open another line of credit. If you can afford more than one payment and you have emergency funds stashed away in a savings account then you can consider opening another credit line to increase your chances of scoring a higher credit score.
If you have ever filed bankruptcy in the last 7 years then it might seem like a lifetime before your credit score rating increases to the point of scoring a high credit score. You shouldn’t let it make you upset though as it will just take a long time to build your history back up. If you chopped up all your old credit cards at the time of your bankruptcy then you should wait about a year or so before you try opening a new line of credit as you will probably get turned down. However, you can do a few different things to check your credit score and your credit score rating with the bureaus.
This is the time that you want to request your copies of your credit score and make sure that they are accurate. You will want to look for any errors like bills that are paid off but are not listed as being paid off, lines of credit that are listed as open but that are closed, or worse yet never opened by you at all. If the last scenario is yours of an account never being opened by you or your household then you should contact the police, the creditor of the account and the three different bureaus. You should tell them that you think that account is fraudulent and explain why to each of them.
You should also be looking for any items that you may have had in the past but that you forgot about in the recent years. Perhaps you had an old account with a hospital bill or something and your insurance finally paid it off but it is not listed as being paid off. In this type of scenario you will want to contact the insurance company, the bureaus, and the hospital or other type of bill that is listed on your credit score rating page. Then have your insurance or whoever paid off the bill for you contact the hospital and the three bureaus to report that it was paid off. They will usually handle the paperwork and the phone calls for you.