Free Tips to Increase Your FICO Credit Score

Low Credit Scores will cost you a lot of money in higher interest payments on loans, credit cards, and insurance.  There is no reason for you not to increase your Credit Score before making any large purchase.  You can save a huge amount of money by making sure your Credit Score is as high as possible, since this will lower your interest rates on loans, insurance, and mortgages. For example, a borrower who applies for $250,000 Home Loan and who has a 580 Credit Score will pay over $350 per month extra than if they had a 720 Credit Score.

Get Your Free Credit Report and Score Online Instantly

Bad Credit?  Get Professional Legal Help Instantly Today

Own a home?  Consolidate Your Debt & Save $1000's.

A word of caution: there are many Internet sites that charge you a small fortune for either trying to increase your credit score themselves or trying to sell you a book that will tell you "secret ways" to increase your Score.  What you need to understand is that they all try and fix your credit report the same way as you would, mainly by disputing items and getting them removed from your report.

With the free tips available on this page, you can fix  your credit report yourself, and keep it high for the future.  Remember, whatever time or money you spend on increasing your credit score and keeping it high will pay for itself many times over because of the lower interest costs you will pay over time. 

Here are the steps to help Increase your Credit Score:

• First, get your Free Credit Score and Credit Report.  You can run your Credit Report monthly and monitor how things are being changed  - without paying each time you check for updates that have been posted.  You will also get your upgraded personalized 3-in-1 credit report, 3 Credit Scores, monitoring and analysis at no additional cost.  Without this key information, you won't know what your score is or how to possibly increase it by removing inaccurate information.

  (You can also get your credit report free once a year from the government, however it wont include your credit score)

  It will cost you some money to get your Credit Report and Score, but you will make it back many times over if you fix something wrong or use the information provided to increase your credit score. The three credit reporting agencies are Experian, Trans-Union, and Equifax.  Since some lenders only report to one of these companies, you will probably have three different credit scores. 

  You can have 3 different Credit Scores since each credit reporting agency might have different information about you.  Your credit score is determined by the following % breakdown:

  • 35% Payment history

  • 30% Outstanding debt

  • 15% Length of your credit history

  • 10% Recent inquiries on your credit report

  • 10% Types of credit in use

  Below is a table showing a sampling of possible different score ranges and how they can affect your loan payment:

  Score Range	Rating	% of US Population	Extra Cost Per month for 200K Loan
  780+	Perfect	20	$0
  720-780	Excellent	20	$0
  675-720	Average	20	$86
  620-690	Fair	20	$242
  Below 620	Low	20	$353

  Get Your Free Credit Report and Score Online Instantly

  Bad Credit?  Get Professional Legal Help Instantly Today

  Own a home?  Consolidate Your Debt & Save $1000's.

Some lenders will look at the scores from all three reports, while some might only look at one  Remember, you don't lose any credit points for checking your own credit report. You will lose some points if there a number of credit inquiries over time for applications such credit cards, auto loans, department store credit cards, etc.  However, you will not lose any credit points from vendors checking your score for marketing purposes.  (Credit Card mailings, etc.)  Remember, you can only affect your score if you initiate the credit check by applying for mortgages, auto loans, credit cards, etc.

Another key thing to remember is your Credit Score is not based on how "clean" your credit report looks.  You may have many things on your credit report that drag on for years, but remember these are good things since they show credit history.  As long as they don't show very late payments, they are adding points to your score since you have proved a reliable consumer.  Don't contact these vendors and close accounts since it might hurt your score.  The items you are interested in are late payments, judgments, delinquencies, etc.

So now you know that repeated inquiries into your credit standing will hurt your overall credit score. Think about this next time you get an offer for 10% off your purchase just for signing up for a store credit card, and just say no! You might save $20 now, but could lose much more than that later due to a worse credit score. Also, if you are shopping for a car or mortgage, try and keep all the inquiries to within two weeks since credit scoring companies will only treat all these as one "inquiry."

Once you've received your credit report, look at the percentage breakdown above and focus on the thing that will help you increase your score, such as payment history and outstanding debt.

First thing is to make sure everything on your credit report is right.  If you see something wrong, make sure you dispute it with the agency. You can dispute it by way of phone, letter, online or via email. By law, the creditor must prove the accuracy of what you are disputing within 30 days. If they don't, it simply gets removed from your report. If you have evidence that something is wrong, then submit the evidence via USPS registered mail to the credit agency and they will have to remove the inaccurate data with 30 days or prove that it's accurate.  Even it you don't remember if it's 100% accurate, dispute it since the creditor will have to prove that the information is accurate.  Many times they can't do this since they might have lost the records, etc.