Published on 10/7/2007

Free tips to improve credit report scores to overcome bad credit card use, loan default, or other problems.

Improve Credit Score - Free Tips

Hardships, unexptected situations and emergencies happen to everyone. But don't surrender at the expense of your financial future. Here are free tips to improve credit report scores.

As you review these tips, keep in mind how your credit report score has a strong impact on your life; which can include job placement/promotion, life insurance limits, loan and credit card approval as well as the interest rates you'll pay.

With that reminder pointed out, here are tips to improve your credit score:

Pay bills on time, every time. Late payments can be a credit score killer. About 35% of your credit score is based on whether or not you routinely pay on time. That's over one-third of your score! If; for some unpreventable reason, you can't pay all your bills on time, try to limit the late payment to just one account. A history of late payments on multiple accounts can cause more harm to your credit score than late payments on just one account.
If you typically pay on time and are considered a good customer but you accidentally miss your payment due date, seek a 'good faith adjustment'. After you've settled your debt, then ask the lender to remove the late payment information from your files. Again, don't expect this to happen unless you're a good customer. If so, they may be willing to work with you to keep you as a customer.
If you've fallen badly behind and debt collectors are banging on your door or ringing your phone off the hook, try negotiating with the collection agencies to 'disappear debt'. Some collection agencies will agree to remove references to the debt from the credit bureau files if you pay them off.
Hang on to older credit cards. 15% of your score is based on credit history length, so it's wise to hold on to older accounts. Make sure you keep those credit cards actively used. An idle, inactive card won't necessarily improve your credit score, regardless of how long you've held on to it.
Keep different types of credit. 10% of your credit score is based on what types of credit you use, so try to keep a variety of credit: credit cards; retail accounts; loans.
Limit new account activations. If you activate a lot of new accounts all about the same time, this may harm your credit score as you begin to look like a higher risk. When the available amount of your credit limit suddenly increases, creditors may fear you might run up higher debt than you can repay.
Track and curb expenses. The more outstanding debt you have, the less likely creditors will approve your for credit or at a favorable low rate. They may increase your interest rate as a safety margin to protect against loss. To keep your credit report score strong, limit yourself to using no more than half of your available credit.

What's your credit score? To find out, order a credit report and be sure to keep track of your score at least annually.