Having a poor credit score can really limit your options. When you have good credit, it’s easier to be approved for credit cards or loans. Also, the lower your credit score is, the higher your interest rates will be when you do borrow. If you currently have a low credit score, you may think that there’s not much you can do about it in a short period. However, this is not the case. Here are four steps you can take to improve your credit score in three months.
- Know what your credit score is
Before you can fix your credit, you need to know where you are at the moment. At Credit Sesame, you can do a free credit score check to see what your score actually is. You can also see what negative items may be impacting your score. Do you have late payments? Do you have a lot of outstanding accounts? These are just a couple of examples of things you need to be aware of.
- Get negative items removed
Often, there are incorrect items on your credit report. It’s possible to get these items removed. You can submit a request to the credit bureau in writing to have these items removed. There also may be old items that haven’t fallen off of your credit report yet, but you can request to have these removed as well.
- Catch up on your payments
The most important thing you can do is to get any late payments or outstanding accounts paid off. You may want to pursue debt consolidation or you may want to try to negotiate with credit card companies or collection agencies to accept a lower amount than they are asking for. Paying your debts won’t erase negative items like late payments or missed payments from your credit report, but it will show creditors that you will be keeping up with your payments from this time on.
- Open a credit card to use responsibly
Keeping the balance low on an active credit card and making payments on time is a great way to improve your credit score. You don’t want to never use credit cards at all, but make sure when you do use them that you are acting responsibly.
- Ask for credit limit increases or pay down balances
Credit utilization is an important factor that affects your credit score. Having only maxed out cards will work against you. You want to have as much credit available as possible that you aren’t using. One way to accomplish this is to get an increase in your credit limit. You just have to be responsible and avoid using all of it.
It may feel hopeless if your credit score is low, but it doesn’t have to. There are steps that you can take to monitor and repair your credit. If you are assertive about these steps, you can even repair your credit in a few months. Don’t despair about financial mistakes you may have made in the past, but do everything you can in the moment to have a better financial future.