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How to Fix Your Credit Score 100 or more points in 6 months

July 19, 2017
Learn how to fix your credit score by 100 points in less than 6 months.
This post may contain affiliate links. See disclosure policy here.

 

Folks are fascinated with credit. Especially after Jay Z dropped a line on his new album 4:44 that alludes to credit being better than throwing money at a strip club.

And I can agree that it can be important, but if you’re not careful, you can actually do more damage and end up costing yourself thousands of dollars in your lifetime.

I’m sure when Jay-Z is speaking on credit, he isn’t paying thousands in interest every month. Nah. If anything, his money earns interest. I could be wrong, but you just don’t see wealthy people focusing on ways to “repair their credit.” But what they are doing is learning how to use other folks money to bring in a positive cash flow.

Nevertheless, folks still want a good credit profile so they can get a piece of the “American Dream” and if you want it, I want you to do it the right way.

So please allow me to run through some ways you can repair your credit quickly (and I truly hope you’ll never be in a position where it will need repair again)!

 

Know Your Score

The first way you can get on the fast track to improving your credit score is by knowing what you’re currently working with. If you don’t know your credit score, you can find it out easily and for FREE. Check out Credit Sesame and stay on top of your credit score for free today.

 

Pay on Time, Every time

If something comes up and you’re not going to be able to make your payments on time, pick up the phone and let your creditors know. Explain the situation and they may be able to work with you. Paying your creditors on time reflects quite nicely on your credit report. Likewise, paying late is the quickest way to send your credit score trending downward.

 

Know What’s On Your Report

If you know your score, that’s good, but it’s not enough. You need to know what’s on your report because there could be errors negatively impacting your score. The easiest way to do this is to check with annualcreditreport.com. You get a free one each year from EACH credit reporting agency. Get all three of them and research for any possible errors. If you find any, dispute them immediately.

 

Pay Extra To Reduce Your Credit Utilization

The way credit utilization works is simple – use no more than 30 percent of ALL of your available credit. This means if you have a two credit card with a total credit of $5,000, you should use no more than $1,500. This article provides some great examples to help you understand credit utilization more.

 

Don’t Close Accounts

If you pay off a credit card, do not close the account. Doing so will impact your credit utilization score and that could cause your credit score to take a nosedive. Leave the account open, but just refrain from using it (unless you’re paying an annual fee on the card, in that instance you might want to close it if there are no additional benefits to keeping the card).

 

Lend Money To Yourself

Yep, you heard me right. These days you don’t even have to use a credit card or traditional loan to repair or build your credit score. You can take out a savings loan. The idea is that you specify an amount for your loan and pay into it each month. It is reported to the credit reporting agencies that you are making on time payments with your savings loan. And get this — once the loan is paid in full, you get the money back! Here is a detailed review on the service that offers it.

 

Use Credit, But Use It Wisely

If a savings loan doesn’t sound exciting to you, the other way to repair your credit is to simply use it wisely.

I know it sounds crazy simple, but really that’s all there is to it. Pick one credit card, charge a small amount you can afford to pay back monthly and repeat month after month.

Never charge more than you can afford. The easiest thing to do would be to pay a small utility bill that you’ve budgeted for using your card. Then pay it off before the due date.

 

Wrapping Thangs Up

You will not be able to repair your credit overnight. It takes only a short amount of time to mess your credit up, but you have to be patient when it comes to fixing it.

Take heed of the suggestions above and commit to sticking to it. Be consistent and responsible and eventually you’ll have the nice credit score you’ve been after and hopefully some better money habits to go along with it.

Remember, the wealthy aren’t in these streets repairing their credit score. Jay-Z’s credit is making him money, not costing him.

 

Latoya Scott
CFEI/Social Entrepreneur
Latoya Scott is a Certified Financial Education Instructor and personal finance writer with a mission to help millennials learn how to stop living paycheck to paycheck so they can become financially carefree.

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  • Cece Anjo July 20, 2017 at 10:39 pm

    A little off-topic: I’m going to be starting a lifestyle blog soon and will be taking advantage of the 36 hr flash sale next week for the Elite Blog Academy. I noticed that you have a blog series on it, but haven’t posted anything new. I read what you posted so far and know that it’s going to be pretty intense. How’s it going for you so far? Anything new to report?

    • Latoya Scott July 21, 2017 at 3:51 pm

      Hi Cece, I haven’t provided an update as of lately because I haven’t been working it. If you’re looking to build a brand I honestly wouldn’t purchase it. There are plenty of other cheap courses if you’re just starting out on how to start a blog (in fact I have a free start a blog course). The information is very intensive and thorough, I’ll give her that, but it didn’t provide me with any direction on where I wanted to actually end up. If you want your blog to be like everyone else’s blog and not compete on ingenuity, this course will teach you just that. But I want to stand out from all the noise and actually transform lives and I just didn’t feel like the course stood up to that. I’m taking another course that has given me so much valuable insight and I would pay for it again 2x’s over, but if I could do it again, I would have saved my money on EBA.

  • Chonce July 24, 2017 at 7:21 pm

    I loved this! Luckily, I haven’t really had a point where I had really bad credit, but I also want stellar credit, so this could still be helpful for me. Thanks for sharing!
    Chonce recently posted…2017 Quarter 2 Income ReportMy Profile

  • Tia @ financially fit and fab July 25, 2017 at 1:33 pm

    I think the part about closing accounts is key to people who THINK they are doing themselves a service. That is one of the biggest lesson I have helped friends with. It is so important to look at the total debt to credit/credit utilization. Closing an account can def lower your available credit.
    Tia @ financially fit and fab recently posted…5 Ways you are Killing your Credit ScoreMy Profile

    • Latoya Scott July 25, 2017 at 2:20 pm

      Exactly! The only time I really would recommend closing an account is when the card has an annual fee and you’re absolutely not using the card. Of course, your credit score would take a hit, but there’s no need in paying for a card you’re not using.
      Latoya Scott recently posted…How to Fix Your Credit Score 100 or more points in 6 monthsMy Profile

  • Easy F August 8, 2017 at 11:04 pm

    Great tips, Latoya! I’ve been working to build mine so I could refinance my student loans but it’s been much tougher than I’ve expected. I might try to take out a savings loan as you suggested!

    P.S. I am OBSESSED with 4:44!

    • Latoya Scott August 9, 2017 at 12:02 am

      Thanks! Glad it helped you!:)

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