Here are five tips for fixing your credit score:
1. Check all three of your FICO scores to see where you stand with different agencies
Your credit score is the average of three different credit bureaus. That’s the good news. The bad news is that these bureaus use different criteria for their scoring models, so it’s important to check with each bureau, not just one. You might be surprised by what you find and any errors on your credit report can be corrected.
2. Inquire about any errors on reports that may be unintentional or can be fixed easily
One of the first steps to fixing your credit is looking into any errors in your reports. Your FICO scores used by the three credit bureaus are averages of 30-35 different factors that make up your score. These include payment history, current percentage owed, debt-to-credit limits, length of credit history and type of credit account. Errors can be complicated and require input from other people involved in order to fix it. Talk to someone at the bureau about any errors or if there are ways to fix them on your own.
3. Understand the impact of negative and positive information that is impacting your scores so you know how to deal with it appropriately
For example, if someone’s birthday falls on December 31st and you only give them credit for having a 12-month credit history, then they might have a lower score because of this. You may need to ask the bureau to extend the date by another day in order to fix the error. A simple mistake like that can drastically reduce an individual’s credit score. Meanwhile, if you are making payments on your loans or mortgages on time each month, that reflects positively on your FICO score and will increase your rating.
4. Consult a reputable credit repair agency for assistance if needed
There are agencies that specialize in helping people fix their credit and they know the tricks of the trade. DON’T try to do it on your own because you might make things worse. If you get taken advantage of, then consult with an attorney and let him or her handle it from there.
5. Avoid paying fees for services that are not authorized by law
There are credit repair agencies that offer services to help you and will charge a fee for it. They might ask for your credit card information or bank account information in order to get the process started, but this is illegal. If they try to charge you a fee without authorization from your bank first, then contact an attorney about it because these people can be prosecuted for fraud.