How to higher my credit score ?

Question

I knew I had a low credit score, so i did a free credit report with experian, it turns out it is 529.

I have a AmEx credit card (Potentially Negative Closed) that is listed as Credit Card - Revolving Terms with a balance of $967. It says it has been reporting since 3-1-05.

I also have a collections from RJM ACQ LLC (Potentially Negative Closed) with a balance of $131. I have started to pay this off and will be done paying it off in 2 months. Reporting since 9-1-07

I also have a CREDIT ONE BANK CC with a limit of $350. The balance this is at $150. The account is open and I use the card once in a while paying about $50 dollars a month on it.

My questions are:

1. Will paying off the AmEx and collection in full improve my credit score? And if so, how long till it reflects on my credit report?

2. How should i go about using my CC to improve my credit score?

Any other helpful insight would be appreciated.

Answer 1

The only way to accomplish this is to pay the bills on time.  Nothing else will help.

Answer 2

Hello...

It takes time and there is no quick fix. In fact, quick fix efforts can backfire. Scores reflect credit payment patterns over time with more emphasis on recent information. The best advice is to manage your credit responsibly over time.

Scores automatically improve, as one's overall credit picture gets better. That means showing a historical pattern of paying your bills on time and using credit conservatively.

Here are some suggested tips to follow:

DO:

1. Pay your bills on time. Delinquent payments and collections can have a major negative impact on your score.

2. If you have missed payments, get current and stay current. The longer you pay your bills on time, the better your score.

3. If you are having trouble making ends meet, contact your creditors or see a legitimate credit counselor. This will not improve your score immediately, but if you can begin to manage your credit and pay on time, your score will get better over time.

4. Keep balances low (1-9% util) on credit cards and other revolving credit. High outstanding debt can affect a score.

5. Pay off debt rather than move it around.

6. Re-establish your credit history if you have had problems.

7. Opening new accounts responsibly and paying them off on time will raise your score in the long term.

8. Note that it is OK to request and check your own credit file. This will not affect your score, as long as you order your credit file directly from the credit reporting agency or through an organization authorized to provide credit files to consumers (such as myFICO).

9. Apply for and open new credit accounts only as needed.

10. Have credit cards but manage them responsibly. In general, having credit cards and installment loans (and paying timely payments) will raise your score. Someone with no credit cards, for example, tends to be higher risk than someone who has managed credit cards responsibly.

DON'T:

1. Close unused credit cards as a short-term strategy to raise your score. NEVER close an open account unless it is costing you money!

2. Open a number of new credit cards that you do not need, just to increase your available credit. This approach could backfire and actually lower your score.

3. If you have been managing credit for a short time, do not open a lot of new accounts too rapidly. New accounts will lower your average account age, which will have a larger effect on your score if you do not have a lot of other credit information. Also, rapid account build-up can look risky if you are a new credit user. Do your rate shopping for a given loan within a focused period of time. FICO scores distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which inquiries occur.

I hope It help you.

Answer 3

Do not close out credit cards but use them without maxing them out. Try not to use more than half of your available credit and be sure to pay them on time. Bad credit on your credit report can stay on your report for up to 7 years, so the faster you pay it off, the quicker it is going to be removed.  

Answer 4

Use your credit card to improve your score. Charge less than your limit each month and try to pay off your balance in month. Pay on time. Your score will improve over time.