Keep your debt ratio low. Credit: Shutterstock<\/figcaption><\/figure>\nThe closer you get to maxing out your credit card, the lower your score becomes. Even if you are paying your bills on time every single month, high credit utilization will stop you from having the high score that you deserve.<\/p>\n
<\/p>\nMake sure to pay your bills on time every single month. Credit: Shutterstock<\/figcaption><\/figure>\n32. Pay Off Your Bills in Full Every Month<\/span><\/h2>\nOne of the best techniques to get a nearly-perfect score is to pay off your credit card bills in full every month. This only works if you never borrow any amount that you could not normally afford in the first place. For example, imagine that you use your new credit card to pay $100 on gas to drive to work. When you get the bill, it might say that you only owe a $15 minimum payment, but you should pay off the entire $100 balance, and start back at $0 owed.<\/p>\nNever miss a credit card payment. Credit: Shutterstock<\/figcaption><\/figure>\nIn this scenario, you need to pay that same $100 on gas no matter what. So you might as well see that as an opportunity to get good credit every month. However, this is easier said than done. The temptation to borrow money to buy things you want is always going to be there.<\/p>\n
<\/p>\nMake sure your debt is never more than the money you make. Credit: Shutterstock<\/figcaption><\/figure>\n31. Pay Attention to Your Debt-to-Income Ratio<\/span><\/h2>\nTechnically, your debt-to-credit ratio will not directly hurt your credit score, but you still need to take this into consideration when you are planning to apply for credit in the future. Are you borrowing more than you can actually afford to pay off comfortably with your current income? The “Debt-to-Income Ratio” or DTI, is when creditors look at your overall debt, versus your income. If you owe too much debt compared to how much you make, you are likely to get offered to borrow far less than you may have hoped.<\/p>\nNever get in so much debt that you will be paying it back forever. Credit: Shutterstock<\/figcaption><\/figure>\nTo find your DTI, add up all of your monthly obligations. This would be your monthly payments for your mortgage, child support, student loans, credit cards, car loan, etc. Next, divide your monthly gross income by the total amount you give away to debt. Your monthly payments towards your debt should never exceed 36% total, and your mortgage should never be more than 28% of your income.<\/p>\n
<\/p>\nYou may need to refinance your student loan debt at some point. Credit: Shutterstock<\/figcaption><\/figure>\n30. Refinance Your Debt<\/span><\/h2>\nAs the years go on, you may get the opportunity to refinance your debt to a lower interest rate, or an easier-to-manage payment plan. For some people, refinancing their mortgage and credit card debt can seriously cut down on their overall repayment.<\/p>\nWhen you get a mortgage, you may have to refinance. Credit: Shutterstock<\/figcaption><\/figure>\nHowever, make sure you do some math and compare both options side-by-side before you say “yes”. Just because the advertisement and sales people tell you that you can<\/em> save x-amount-of-dollars each month doesn’t meant you always will.<\/p>\n<\/h2>\nIf you apply for too many credit cards at once, it can get you into trouble. Credit: Shutterstock<\/figcaption><\/figure>\n29. Don’t Apply For Too Many Cards<\/span><\/h2>\nEvery time you apply for a new line of credit, this will “ding” your credit score for a hard inquiry, and bring it down. If you get accepted and a new card opens up a line of credit, the number of points your score will go up will make up for the ding. However, if you keep applying for multiple cards in a short period of time, this can be very bad.<\/p>\nA huge stack of cards is nothing to be proud of. Credit: Shutterstock<\/figcaption><\/figure>\nA lot of credit card companies are also looking out for people who take advantage of sign-up bonuses. Every credit card company has different rules, so it can get a bit complicated. However, a good rule of thumb to follow is that you should wait at least 2 months in-between signing up for new credit cards.<\/p>\n
<\/p>\nTry to calculate if you are likely to get approved before you apply. Credit: Shutterstock<\/figcaption><\/figure>\n28. Check Your Odds Before You Apply<\/span><\/h2>\nGetting rejected for a credit card application can hurt your ego, but it also damages your score. And if you are trying to apply for a loan because you need it, you may end up applying to and getting rejected by multiple loans in one day. Earlier in this list, we mentioned how debt-to-income ratios work. Instead of jumping into a situation where you may be rejected, you should do some research, first. Check your DTI, credit score, and the amount of money you wish to borrow.<\/p>\nCalculate your odds of being accepted before you apply for a loan. Credit: Shutterstock<\/figcaption><\/figure>\nIf you are looking to apply for a credit card, you can check your odds online, too. For example, some credit cards have an “elite” status, and they only accept people with “perfect” scores who make above $100,000 per year. So it would be silly for someone who only makes $25,000 a year with a 600 credit score to apply to that elite card, because it will just show up as a hard inquiry and rejection on your credit report. Thankfully, the Internet is full of all the information you could possibly need. Always do your research of your odds ahead of time.<\/p>\n
<\/p>\nYou may want to keep open lines of credit to help your score. Credit: Shutterstock<\/figcaption><\/figure>\n27. Do Not Close Empty Credit Cards<\/span><\/h2>\nA lot of experts say that you should never close a credit card, because your available credit percentage is calculated by the number of cards you have open. We already mentioned on this list that you should never have more than 30% of your open credit filled. So, how does having an open credit card help your score? Let’s pretend we have two credit cards. One has a $0 balance, so it is 100% free of debt. The other has a $4,000 credit limit, and you spent $2,000. So it has been filled by 50%. Take the average of the two: 100%+50%=150%. Divided in half to get the average of two cards is 75% free. If you keep both cards open, you will have a 25% credit utilization, but if you close the empty card, it goes back up to 50%. Make sense?<\/p>\nOnly close accounts if you truly need to. Credit: Shutterstock<\/figcaption><\/figure>\nOn the other hand, if you have tried to keep open credit cards in the past, and they became too much of a temptation for you, it may be a good idea to just close down the account, anyway, and just try to pay down the cards you have open. This is especially true if you have so many credit cards open, it’s hard for you to keep track. When you go to apply for another card in the future, this will never affect you negatively. Creditors will see that you were responsible and paid off your debts in full.<\/p>\n
<\/p>\nIf your income grows, don’t forget to tell the credit card companies. Credit: Pexels<\/figcaption><\/figure>\n26. Regularly Update Your Income Changes<\/span><\/h2>\nSince creditors are always judging you on your debt-to-income ratio, you should always let your creditors know if you have an increase in your income. Usually, credit card companies will ask you at least one a year to update them on your income, but you can volunteer that information whenever you want.<\/p>\nThroughout your life, your income may change. Credit: Shutterstock<\/figcaption><\/figure>\nIf you suddenly get a new job that makes double what you did before, this should help your DTI, and overall odds of getting accepted. Earning more money will not automatically mean you get a higher credit score, though. However, if you call your credit card company, you can let them know that you are making more money, and request a credit increase. If they give you the increase, this will free up your credit utilization. Once you have a lower percentage of debt on those cards, that is what will bring your score up.<\/p>\n
<\/p>\nBe careful of car salesmen. Credit: Shutterstock<\/figcaption><\/figure>\n25. Don’t Allow Car Sales People to Query For Loans<\/span><\/h2>\nWhen you go to buy a new car, sales people will search their system to get you matched with financing. This is actually terrible for your credit score, because they will often go into their computer and put your information into multiple loans at once, meaning that there are a dozen “hard inquires” in your name happening all at once. If you are trying to get your “dream car”, you may also get rejected by a lot of banks. This can significantly drop your score up to 100 points in one day. Yikes.<\/p>\nTry to come ready with your own auto financing. Credit: Shutterstock<\/figcaption><\/figure>\nThankfully, you can prevent this from happening by getting your own auto financing prepared ahead of time. If you have gotten a letter in the mail offering auto financing from your bank, take a look at their invitation offer. Often, you can do a “soft inquiry” to see how much they are willing to offer, without it hurting your score. This will also help to give you a budget to get a better idea of what cars you can actually afford to buy. For example, if your bank gives you a $30,000 offer, you should stay away from getting a brand new Tesla, because you are likely to get rejected, or end up with a loan that is charging you an incredibly high percentage for a car loan.<\/p>\n
<\/p>\nIf you cannot handle the tempation, it is best to just cut up your cards. Credit: Shutterstock<\/figcaption><\/figure>\n24. Cut Up Your Cards<\/span><\/h2>\nYou can always keep the two card pieces for reference. Credit: Shutterstock<\/figcaption><\/figure>\n<\/p>\nWhen you get a new credit card, try to resist temptation to over-spend. Credit: Pexels<\/figcaption><\/figure>\n23. Resist Temptation to Over-Spend<\/span><\/h2>\nTry not to give in to online splurging. Credit: Shutterstock<\/figcaption><\/figure>\n<\/p>\nIf you pay the minimum payment due, it will take so much longer to pay off. Credit: Shutterstock<\/figcaption><\/figure>\n22. Pay More Than the Minimum<\/span><\/h2>\nTry to pay more than the minimum every month. Credit: Shutterstock<\/figcaption><\/figure>\n<\/p>\nYou should be creating a debt spreadsheet. Credit: Shutterstock<\/figcaption><\/figure>\n21. Create a Debt Spreadsheet<\/span><\/h2>\nFor some people, the idea of creating a debt spreadsheet might cause a pit in your stomach from all of the anxiety. However, if you are really determined to lower your debt and raise your credit score, you should consider making a spreadsheet. You can do this for free using Google Sheets, or Microsoft Excel. In each column, you should have the name of your credit card company, online login info, the total amount you owe, interest rate, and monthly payment.<\/p>\nTry to identify what cards are causing you the biggest problems. Credit: Shutterstock<\/figcaption><\/figure>\nOnce you see all of this information laid out in front of you on a spreadsheet, it will become a lot easier to identify which cards are your real troublemakers. Whether it’s a high annual fee, or an outrageous interest rate, you should be able to know right away which card to tackle first.<\/p>\n
<\/p>\nPaying down your student loans is challenging for everyone. Credit: Shutterstock<\/figcaption><\/figure>\n20. Get Your Student Loans Out of Deferment <\/span><\/h2>\nMany people decide to put their student loans under deferment as soon as their graduate from college, or if they decide to go back to school. This means that they are not making any payment towards their debt, but interest continues to accumulate. Technically, this is not as bad as being delinquent on an account, and it will not hurt your credit score. But it is not doing your score any favors, either.<\/p>\nIf at all possible, get your loans out of deferment. Credit: Shutterstock<\/figcaption><\/figure>\nFederal student loans allow you to make income-based repayments. They will look at your tax returns from the previous year, and give you a payment based on how much money you make. So, if you truly cannot afford a monthly payment, your “amount due” each month might drop to $0, but you will be in “repayment” status. So, if you pay any amount at all towards your debt each month, it will be higher than the monthly minimum, and it will help your score.<\/p>\n
<\/p>\nIf you are struggling to be accepted, consider a co-signer. Credit: Shutterstock<\/figcaption><\/figure>\n19. Get a Co-Signer<\/span><\/h2>\nIf you are still young and don’t have a lot of income or established credit history, you may be able to convince one of your friends or family members to help you by becoming a co-signer. Usually, the best choice is to ask your parents or grandparents. They love you, and want you to succeed in life. And if you default on your loan, they may not mind helping as much as your roommate or significant other.<\/p>\nSometimes, your parents may be willing to be co-signers. Credit: Shutterstock<\/figcaption><\/figure>\nKeep in mind that not every lender will give you the option to use a co-signer. You will have to ask ahead of time if you plan to use their assistance. If you find someone who is willing to let you use them as a co-signer, you truly need to show how grateful you are. This is a huge responsibility, because they are taking on the risk that you may lose your job and ability to pay for the loan. They will also be responsible to pay back the debt if you die. It should be taken very seriously.<\/p>\n
<\/p>\nHave you declared bankruptcy? Credit: Shutterstock<\/figcaption><\/figure>\n18. If You Declared Bankruptcy, Make Sure It’s Reported Accurately<\/span><\/h2>\nWhen you declare bankruptcy, most of your debt (except student loans) will be erased. However, this completely ruins your credit score, and it will stay on your report for 10 years. It may also prevent you from being accepted into certain apartment complexes, and so much more.<\/p>\nEven if you lost everything in bankruptcy, it’s possible to get it back. Credit: Shutterstock<\/figcaption><\/figure>\nAfter the bankruptcy is over, you should still get your credit reports, to make sure that the dates have been reported accurately. The last thing you want is to have to wait longer than 10 years. You will have to contact the credit bureau directly, and fill out paperwork disputing anything that you claim is incorrect.<\/p>\n
<\/p>\nIf there is something wrong on your credit report, you need to fix it right away. Credit: Shutterstock<\/figcaption><\/figure>\n17. Dispute Anything Incorrect On Your Credit Report<\/span><\/h2>\nAs we just said in the last entry, there is always the possibility that something was reported incorrectly on your credit report, and it could be negatively affecting your score. Maybe you paid off a loan, and it still shows as an outstanding debt. Or, maybe someone has taken something out in your name, and you are a victim of identity theft. No matter what the issues may be, you are responsible for making sure it gets corrected.<\/p>\nIt can be shocking to see something unfamiliar on a credit report. Credit: Shutterstock<\/figcaption><\/figure>\nIf you see something wrong on your credit report, you need to contact the bureaus immediately. If you are a victim of identity theft, this may mean that they have to “freeze” your credit, which means that you will not be allowed to borrow anything else.<\/p>\n
<\/p>\nCredit repair companies are just trying to take your money. Credit: Shutterstock<\/figcaption><\/figure>\n16. Don’t Fall For Credit Repair Companies<\/span><\/h2>\nThere are some companies out there who claim that they can “repair” your credit, even if you have been in a bankruptcy. If you get an offer from one of these companies, you need to avoid them at all cost, because they are likely a scam.<\/p>\nDon’t fall for credit company scammers. Credit: Shutterstock<\/figcaption><\/figure>\nNo matter what you do, there is no way to speed up the 10-year process of waiting for your bankruptcy to be removed from your credit report.<\/p>\n
<\/p>\nIf you work from home, make sure you keep good records. Credit: Shutterstock<\/figcaption><\/figure>\n15. Try to Keep a Steady Job<\/span><\/h2>\nIf you are trying to improve your credit score, it is probably because you eventually want to apply for a mortgage. Credit cards will ask you to update your income at least once a year, but they don’t bother to ask where you work. That all changes once you are prepping to buy a house. Keep in mind that most large loans and mortgage companies will ask to see your employment history. If you frequently change jobs or get fired, this is a huge red flag, and it it a sign that you may default on your loan. They want to see that you have stayed at the same job for at least two years in a row.<\/p>\nHopefully you are in a job that you enjoy. Credit: Shutterstock<\/figcaption><\/figure>\nIf you are self-employed, you will need to provide proof of income for at least three years. Mortgage companies will divide those three years into an average of what you make per year. Unfortunately, a lot of start-ups don’t make a profit in the first few years of running a business. So, unless you have a massively successful third year, you may actually end up waiting at least 5 years.<\/p>\n
<\/p>\nRemember to always do your taxes on time every year. Credit: Shutterstock<\/figcaption><\/figure>\n14. Always Do Your Taxes<\/span><\/h2>\nEven if you do not owe anything on your taxes, you should still do them every year, because you need to have a record of how much you made. Many lenders, mortgage companies, and apartment complexes will ask for your tax returns before they make a decision on your credit-worthiness. So if you never did you taxes, you may find yourself going to an accountant to file for previous years.<\/p>\nIf you don’t like doing the math required on your taxes, use a filing software. Credit: Shutterstock<\/figcaption><\/figure>\nIf you are self-employed, it is especially important for you to do your taxes. Many mortgage companies want to know that your business is stable, so they will judge you based on your gross income from the past three years. So it is vital for you to make sure you are keeping track of your income and expenses.<\/p>\n
<\/p>\nIt takes a long time to fix your credit score. Credit: Shutterstock<\/figcaption><\/figure>\n13. Remember That It Takes Time<\/span><\/h2>\nNo matter how hard you try, it takes a long time to fix your credit score. Unless you win the lottery and have a huge windfall of money, you are going to have to steadily make payments on time and start having better spending habits.<\/p>\nIt could take years to fix your credit. Credit: Shutterstock<\/figcaption><\/figure>\nEvery situation is different from person-to-person, so we cannot make any promises as to how long it will take for you to fix your credit score. But there is no luck involved. It’s all numbers. So as long as you are doing the right things, it will eventually get better.<\/p>\n
<\/p>\nIf you have bad credit, it’s best to figure out why. Credit: Shutterstock<\/figcaption><\/figure>\n12. Pinpoint Where the Issues are<\/span><\/h2>\nA credit score is just a number. That alone will not tell you where your specific issues are. Two people could have the same exact credit score, but when you look at their credit reports, it tells a very different story about where the problems are.<\/p>\nOnce you know all of your current issues, it becomes easy to fix them. Credit: Shutterstock<\/figcaption><\/figure>\nFor example, you could have never declared bankruptcy before, and you are paying your bills on time every single month. But if you are always nearly maxed out on all of your credit cards and constantly hitting your limits, your score will continue to go down or remain stagnant. When you sign up for an account with Credit Sesame, they will help you pinpoint exactly what you are doing wrong to get a low score.<\/p>\n
<\/p>\nTry to make a plan as to how you are going to fix your credit score. Credit: Shutterstock<\/figcaption><\/figure>\n11. Make a Game Plan<\/span><\/h2>\nEarlier in this list, we mentioned creating debt spreadsheets to help you get more organized. Once you have these spreadsheets created, it’s time to make a game plan about how<\/em> you are going to pay off your debt and repair your score. It’s also good to give yourself a timeline, because this will help give you peace of mind to know when things are bound to get better, and you can begin shopping for a mortgage.<\/p>\nSpreadsheets can be really helpful in your game plan. Credit: Shutterstock<\/figcaption><\/figure>\nFor example, let’s assume you have an extra $500 to put towards your debt on month. Should you spend an extra $100 on 5 credit cards, or pay off an entire balance at once? That all depends on your credit utilization, the interest rates, and so much more. These decisions need to be calculated on a case-by-case basis. It may seem tedious to think about it, but trust that once it’s done, you will feel empowered to get your credit back on track.<\/p>\n
<\/p>\nTry not to be late on your payments. Credit: Shutterstock<\/figcaption><\/figure>\n10. Try to Fix Your Late Payments<\/span><\/h2>\n