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Posted by on Apr 23, 2012 in Student Loans | 0 comments

5 Ways to Raise Your Low Credit Score

Low credit and bad credit is a curse that many Americans are dealing with right now.

Low credit can keep you from doing many things in this society from buying a house, qualifying for a loan, renting a residence, purchasing a car, and even renting important items.

It can be very frustrating to be bogged down by a low credit score, but you don’t have to stay that way. There are some good things you can do to raise your low credit score.  Here are 5 ways to raise your low credit score:

  1. Consolidate Your Debt.  Consolidation of debts is kind of a controversial thing right now, but when it is done right, it can be a huge blessing to you and can help you raise your low credit score.  If you can make the minimum payments on all your smaller debt balances, and if you can get a lender to consolidate this debt at a lower overall APR than you are currently paying, then debt consolidation is a great way to quickly raise your low credit score.
  2. Close Out Open and Unused Accounts.  Do you have credit accounts with stores that you aren’t using anymore?  Do you have credit cards that have been paid off or never used and are sitting open?  Get rid of these.  They look bad to credit monitoring agencies and can pull your score down.
  3. Pay Off Some of the Debt.  This is a no-brainer, but it can make an immediate impact on your low credit score.  If you can scrounge up a nice chunk of change to drop on a credit balance, then your low credit score will definitely move up a few points and will get the momentum going in the right direction.
  4. Try to Settle Any Old Debts.  If you have credit balances hanging around from more than 5 years ago, then chances are they have all but given up hope on getting payment from you, and they have more than likely already garnered a profit from you on the interest you have been paying.  Call the offices and see if they will take a lump sum of far less than the balance in exchange for closing down the whole account.  Many people will happily work with you in this manner because getting some money from you is better than getting nothing.  If you go this route, be sure and get the contract in writing that you are no longer obligated to them for anything.  Settling out old credit accounts like this will definitely be a good way to raise your low credit score.
  5. Raise Your Income.  One of the biggest factors that goes into determining your credit score is your debt to income ratio.  To make this ratio more appealing, you need to make more money.  Get a second job, ask for a raise, have your spouse take a job, etc.  Find a way to raise your income, and you will have found a way to raise your low credit score.  PLUS this will give you more money to use towards paying down the debts that are dragging down your credit score in the first place.

There are lots of other things you can do to raise a bad credit score, but these are the 5 easiest and most effective ways to raise your bad credit score fast.

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