Imagine transforming your credit score by 200 points in just 30 days—sounds pretty incredible, right?
While the challenge of a major credit score overhaul in just 30 days might be a tall order, you can achieve significant results quickly with the right strategies and dedication. If you're feeling overwhelmed by your current credit situation or just eager to boost your financial standing, keep on reading.
Don't let your low credit score dishearten you. Remember: small changes can lead to big improvements in your financial success.
Let’s jump right into the practical steps of how to raise your credit score 200 points in 30 days…or at least improve your score dramatically.
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1. Dispute Credit Report Errors
One of the easiest ways to improve your credit score for free is to check your credit report periodically and look for any signs of errors. It’s pretty common to have errors on your credit reports, and fixing them can change your credit score in no time.
To check your credit score, you need to order credit reports and check them for duplicate accounts, incorrect account information, and fraudulent activity. While fixing those errors has a significant impact, it may take some time (more than 20 days) to see results.
The reason is that the dispute process can take at least 30 days, so it will take time for those changes to reflect on your credit reports and credit score. Still, it’s one of the most important and free ways to increase credit score.
2. Pay Down High-Value Debts
Lowering your credit utilization ratio is essential. You can accomplish this by paying down your high-value debts. About 30% of your FICO score is based on credit utilization, so lowering your balances will bring this ratio down and push your credit score up.
The impact of this step is visible as soon the credit companies are notified about the lower balances by your credit card companies. Therefore, you should pick credit cards with the highest balances first. Also, remember that you must use your savings or other funds you already have access to when paying down these debts.
3. Request Higher Credit Limits
As mentioned, lowering your credit utilization ratio is vital to repairing your credit history and score. One way to do that is to request higher credit limits, which may be a suitable option when you don’t seem to have savings to pay down your balances. An increased credit limit would translate into a lower credit utilization ratio even if your balances remain unchanged.
You must ask your credit card issuers to revise your credit limit. If they agree to that and report to the credit bureaus, you will see a quick change in your credit score.
Just keep in mind that sometimes asking for a revision could result in a hard inquiry on your credit report. As a result, your credit score may go down for a short time.
4. Be an Authorized User
Sometimes, it’s possible to leverage someone else’s positive credit history and credit score to improve yours as well! You can accomplish this by becoming an authorized user on their credit card account.
For example, you might ask a trusted friend with an excellent credit score to do you a favor and add you as an authorized user. This method ensures that you build a positive credit history without having to use the card. Just ensure the credit card account you choose reports to all three major credit bureaus.
5. Pay Often
Don’t delay paying credit card bills; in fact, you should pay twice a month to keep your balances as low as possible, which lowers your credit utilization ratio. You can split your monthly payment into a couple of smaller payments for the best results.
Schedule your payments and stick to that. You can also use some credit repair tools to set reminders and track your payments without missing any. Consistent payments will improve your credit score within a couple of billing cycles if done accurately.
6. Don’t Close Old Credit Accounts
While it may feel tempting to close older accounts, don’t do it! Instead, maintain them to increase the length of your credit history. This particular factor usually accounts for 15% of your credit score.
When you close your old accounts, the amount of credit available decreases, negatively affecting your credit score. Also, it’s good practice to use those older accounts occasionally to keep them active.
While maintaining these accounts may not immediately impact your credit score, it’s still worth the effort as the benefits accumulate over time.
7. Consider Diversifying Your Credit Mix
Many people don’t know that diversifying credit types can actually help improve credit scores. For instance, besides having credit cards, you can include installment loans, such as auto or personal loans, in the mix.
Credit scoring models, like VantageScore and FICO, always consider credit mix. In fact, it is one of the five factors that make up about 10% of your credit score.
You must manage new credit carefully and responsibly. It’s your way of telling credit companies you know how to handle your finances. Paying attention to this aspect will make you appear to be a lower-risk borrower. Therefore, you’ll see some positive results in your credit score.
How Long it Takes to See a 200-Point Increase in Your Credit Score
The tips mentioned above will help you see a quick change in your credit score, but you still need to have realistic goals. The truth is that how fast you can increase your credit score depends on various factors. For instance:
● Credit history: You are more likely to see a rise of 200 points in your credit score if you are new to credit without spotty credit reports. It may take longer to achieve your goal when you have profound negative items on your reports.
● Consistency: Building credit requires excellent consistency, and many people fail because they get complacent after being active for a few weeks. Depending on your consistency, you can see better results quickly.
Every case is different, and your unique financial circumstances will determine how long it will take to build a positive credit history and see an increase in your credit score. You may need to adjust your expectations according to your situation.
Summary of How to Raise Your Credit Score 200 Points in 30 Days
Having a less-than-perfect credit score can cause dire problems in financial health because it impacts everything! Raising it by 200 points in 30 days is challenging, but you can eventually achieve your goal by being consistent and following the right strategies.
Be sure to use all the help you can find, whether it means using credit repair tools or consulting a professional. Once you understand what improves your credit score, you can focus on those strategies to eventually raise it by 200 points and reach your financial goals.
Kristin McCasey is a partner and editor atPlay Louder!She is a former award-winning film editor turned work-at-home-mom blogger. Three years after their son was born, she and her husband left their Los Angeles careers to have more time as a family. She now works with her husband, Joe, on their finance blog, teaching others how to achieve financial independence.