Its 2009! A new year means a new beginning, and is a perfect opportunity to improve your credit score. As a result of the sub-prime credit and lending crisis, lenders now want a spotless credit report to approve new credit.
That means that it is more important than ever to focus on increasing your credit score. So, lets get started on your road to raising your credit score.
First, its important that you understand how your credit is calculated. Your credit report contains information including your payment history, debt total, and available credit.
This information is strategically placed in a mathematical formula, and then calculated to generate your credit score. The determined number is a highly accurate prediction of how likely you are to pay your bills.
The best credit score is 850 and the lowest is 300. The average American has a score between 600 and 800. To really benefit, you must raise your credit score so it is at least in the average range.
The next and most important step is to increasing a credit score is disputing credit information that damages a good score. This includes collections, late pays, repossessions, charge-offs, bankruptcy, and judgments.
1 in 4 credit reports have a mistake that is serious enough to keep a consumer from receiving credit approval. And, another large amount of credit reports contain errors that force a consumer to pay higher interest rates on big ticket items.
When you improve your credit score, youll save money, time and embarrassment. Mistakes can end up on your credit report for numerous reasons, including: mistaken identities, identity theft, and administrative mistakes.
Regardless of the reason, if you want to raise your credit score, you must dispute any errors you find. When you find an error, you should write a letter to the top credit bureaus and ask them to investigate the mistake.
Thanks to the unstable economic times, its more important than ever to improve your credit score.
By taking the steps listed above, youll be on your way to a great score, and a better quality of life.
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