Considered the barometer of financial health, a high credit score offers consumers lower interest rates and better terms on large purchases or mortgages, resulting in a savings of thousands of dollars over the course of the loan. Even if you aren’t considering making a major purchase, raising your credit score can also help by lowering the rates of credit cards and home equity loans. Here are some ways consumers can raise their credit score in 2009.

• Begin by checking your credit report for accuracy. Request a free copy at www.annualcreditreport.com. Be sure all account information is correct and review all areas for errors. Immediately report any discrepancies to the proper credit bureau. Keep on them until the issue is resolved.
• Pay all your bills on time. Even one late payment will reflect poorly on your credit report and affect the rates you will pay on future loans and credit accounts. Collection actions and defaults will remain on your credit report for up to 10 years.
• Maintain low credit card balances to keep the ratio of credit card debt to available credit low. The more funds you have available to borrow the better your credit score will be.
• Apply for additional credit only if absolutely necessary and after you have fully researched the company to be sure you qualify. Excessive inquiries for additional credit reflect poorly on your credit report.
• Consistent use of credit gives lenders a clear picture of your ability to handle credit responsibly. Many consumers trying to get their debt under control make the mistake of ending credit spending entirely. For credit report purposes, use your card at least once every 6 months.
• Keep old lines of credit open. Long-standing accounts have a positive impact on a credit score. Consider using it once every 6 months to show activity.
• Take advantage of the 100 word personal statement that can be included in your credit report. A well crafted statement about your unique circumstances or credit worthiness could positively influence a lender. But keep in mind that lenders could still bypass this statement and only consider your score.

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Posted in Credit Tips, Card Advice

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