You have to have a good credit score to have a healthy financial future, but there are so many ways to damage your credit unwittingly that many people have credit scores that are less than ideal. Even small mistakes can deal big blows to your credit scores that may take months or even years to repair. Fortunately, there are ways to speed up the recovery process. If your scores need a boost, here are some quick, legal ways to push them up.
Co-sign On A Credit Card
One of the quickest ways to boost your credit score is to piggyback on someone else’s credit. If the credit card issuer is cooperative, being added as an authorized user to someone else’s credit card can raise your own scores. Some credit-score formulas ignore authorized-user information in their calculations, but FICO, the leading credit score, still takes authorized-user information into account. You do not actually need to have access to or use the card, as the other person’s responsible use will be reflected on your credit history.
Pay Off Your Credit Card Debt
Credit utilization is a big part of the FICO credit-scoring formula and if you are using a high percentage of your credit, your credit score will be much lower than it could be. The less of your available credit you use, the better. If you currently carry high credit-card balances, consider paying them off or down with a personal loan with a fixed-rate from a bank or credit union. You will be paying a lower interest rate on the same balance and transform the nature of that debt in the eyes of credit-scoring formulas.
Spread Out Your Debt
If you cannot obtain a loan to pay off your credit card debt, you can try boosting your credit scores by spreading out your debt around to several different credit cards. The FICO formula looks at the credit utilization of each individual account, so a big balance on a single card can hurt you more than the same debt distributed over several cards. Don’t just open a bunch of new credit card accounts at once because that can hurt your scores, but transferring some of your debt to other cards that you already have can increase your credit score by a significant amount. Remember that your ultimate goal should be to pay off your debt, so once you have transferred the debt, make a plan for paying it all down as fast as possible.