What is the fastest way to improve my credit score?

The fastest ways to increase your credit score are to pay down debt, dispute errors on your credit report and improve your credit utilization. Your credit score is based on the contents of your credit report and reflects how responsibly you’ve managed lines of credit, loans and other debt obligations. Showcasing healthy financial habits on your report will ultimately raise your score.

Fastest Ways to Increase Your Credit Score

If there are inaccurate entries on your credit report impacting your score, you can file a dispute via phone, mail, or online with all three major credit bureaus. The bureaus should respond within 30 to 45 days.

Creditors, collection agencies and debt buyers are not required to remove negative entries from your credit report. However, they can as a courtesy. This is also known as a goodwill adjustment. Although not guaranteed, consumers have found success with this strategy.

An ideal credit utilization ratio is 1-10%. Paying down your revolving credit balances and reducing your utilization will positively impact your score.

Becoming an authorized user on a friend’s or family member’s credit card account increases your overall credit limit and allows you to benefit from the accountholder’s on-time payments.

A credit limit increase will reduce the credit card utilization for your individual card and your overall utilization. It is important to note, applying for a credit limit increase usually results in a hard inquiry that can temporarily lower your credit score by 10 points or less.

Late payments can have a detrimental effect on your credit. Every month an account is delinquent, your score declines further. It’s imperative to bring all of your accounts current.

Negotiating lower interest rates will reduce your overall monthly payments. With access to more capital, you can pay down your outstanding balances, which lowers your total debt load and helps your credit score.

You can check your credit score for free here at WalletHub.

Our credit score simulator and personalized tips can also help you decide which steps will have the greatest impact on your credit and what to do next.  

Quick is a relative word in credit repairing, and if you have big negative marks, including foreclosures, short sales, bankruptcies, tax liens, charge-offs, and judgments, it will take up to 7 years to erase them off your report.

However, here are a couple of things you can do:

1. Pay small pending balances: If you have multiple cards, start with a couple having low balances, ranging in $50 to $200. Clearing these small balances will indicate to the credit agencies that you’re trying to pay the debt.

2. Ask for credit limit increase: Try to choose an old card, one with a good payment history. Increasing your credit limit is likely to lower your debt utilization, and net you some credit points.

3. Use traditional 30% usage formula: It is best if you stop maxing out your card, and I understand that it could be difficult, so start bringing your credit usage down gradually until you reach 30% utilization.

4. Use credit card for Netflix or similar utility services and repay it full: If you don’t have an excellent bill payment history, start using your card for small charge-offs like Netflix service and pay it off in full.

These simple acts will indicate good credit behavior and will go far in repairing your credit. Prior to using any of these tips, get your credit report from all the three bureaus and look for errors.

Correcting credit errors can boost your credit score quickly, at least 60 days.