When you have a healthy credit score, lenders are more likely to approve you for major loans like a mortgage for a home or financing for a new business. However, your credit might have taken a hit because of tough financial times, or you may lack any history of paying off debt.
The good news is that there are many options for people who want to know how to increase a credit score quickly.
Table of Contents
Using Credit Cards for How To Increase a Credit Score Quickly
The key to boosting your credit is to show that you can make debt payments on time and on a consistent basis. A common way people demonstrate their fiscal responsibility is by using a credit card. The key to building up good credit is to take certain actions while utilizing your card:
- Do not use too much of your credit
- Pay your credit card bills on time
- Refrain from opening too many new accounts at once
- Build a long history of credit
If you have an existing card, it is not hard to perform these steps. However, if you have recently experienced financial troubles or are just starting out with credit, you may have to apply for a new card. If this is the case, now is a good time to learn where to find a card that can help you build credit.
Choose Among Different Cards
You may not have a problem applying for a card if you already have a good credit history. However, some card companies are reluctant to approve an applicant who has gone through bankruptcy or has never paid off debt before.
Fortunately, there are different options for how to increase a credit score quickly despite these circumstances.
Secured Credit Cards
Graduating from high school or college shows that you have acquired the knowledge and skills to help you find a job. In a similar way, secured credit cards are like a school for learning how to handle debt. In fact, a secured card may “graduate” into a traditional credit card that could help you boost your credit score to an even greater extent.
Some credit card companies offer secured cards that you can apply for. These cards require you to deposit a certain amount of money into an account. The bank holding your money then extends you a line of credit that matches your deposit. From there, you can use your secured card to make purchases.
Your bank will typically report your card’s activity to the credit bureaus, so using a secured card lets you build up credit. Also, it is important to check the terms of your card for a graduation threshold. Many secured cards transform into traditional cards after a period of making regular card payments.
People who want to know how to increase a credit score quickly but do not have money to deposit on a secured card have other options. Sometimes you do not have to go any further than a mall department store, a strip-mall retailer, or even a gas station to find a new card.
Many retail outlets offer credit cards without the challenges you may encounter with a major lender.
Retail credit cards are an attractive option if you have little to no credit history. Keep in mind that retail cards generally are only for use in a specific retail outlet. However, a retail card can be useful if you are a frequent shopper at a certain location. Also, they tend to offer a smaller line of credit. This should help you keep your payments low and avoid excessive debt.
Co-Sign a Card or Become an Authorized User
Even if your credit score is low or nonexistent, your family members or friends may have good or excellent credit. Another method for how to increase a credit score quickly with credit cards is to apply for a card and ask a person with good credit to co-sign the card.
Taking this step allows you to build your credit by making payments on the co-signed card. In time, the boost in your credit may help you apply for your own card.
If your friends or relatives are reluctant to co-sign, ask a family member about becoming an authorized user on their card. As an authorized user, you receive your own card. If your relative continues to make payments on the card, your credit benefits as well and may help you attain your own card in the near future.
Checking Your Credit Report for Mistakes
All your hard work to boost your credit score may not assist you as much if your credit report does not accurately reflect your credit history. Wrong information on your report could lower your credit score. To uncover mistakes, first, contact the three major credit bureaus to get copies of your credit report from each of them. Upon receiving your reports, check for the following:
- Incorrect balances: One or more of your accounts may show an account balance or a credit limit that is smaller or larger than you currently have.
- Account or debt duplication: You may have an account listed more than once with a different creditor attached to it or a debt that appears multiple times.
- Erroneous open accounts: If you have closed accounts, they should not appear as open.
- Misattributed accounts: Your report may list an account that does not belong to you.
- Wrong personal information: Anything from your name to your contact information might not be correct.
Once you have picked out mistakes, contact the bureaus and the institutions listed on the report to correct the erroneous entries. Cleaning wrong information off your credit report could help you increase your credit score quickly.
Learning How To Increase a Credit Score Quickly
If you are hoping to get a loan, there are ways to improve your credit. Even if traditional lenders see you as a financial risk, there are options like secured credit cards to help prove you can pay off debt on a regular basis. Fiscal Tiger understands the need to maintain the confidence of financial institutions and can provide information on how to increase a credit score quickly. Check out our resources to learn more about repairing your credit and creating a better credit score.
Want a FREE Credit Evaluation from Credit Saint?
A $19.95 Value, FREE!