How To Improve Your Credit Score
Know how to improve your credit and increase your score. A comprehensive review of your credit report is called a FICO score. A FICO score is numbered between 300-850, which lenders use to determine your credit standing, it is a snapshot of your credit history at a particular time. There are five areas in your credit score calculations that range from most important to least important.
35% = Payment History
30% = Amount owed
15% = Length Of Credit History
15% = New Credit
5% = Inquiries
You must understand your rights and factors concerning each account on your report. Prepare a plan of action to address each account on your FICO and understand your legal rights as a consumer. Dispute the accuracy or anything incomplete, unverifiable, and outdated with bureaus for validation. Check for re-aging accounts, debts over the “statue of limitations,” or unverifiable. When you settle on a derogatory debt, you can potentially decrease your score from 10 up to 20 points per transaction. Any accounts that belong to the consumer, and are paid, will remain on the report 7 years from the date of last payment. Be aware of companies that promise to remove this debt once payment is received.