Home > Credit Score > 5 Free Ways to Improve Your Credit Score

Comments 1 Comment

Whether you’ve got bad credit, no credit or are simply looking for a boost in your quest for a loan, improving your credit score can seem daunting — after all, you’ve got all those different credit scoring models, terms (credit utilization ratio, anyone?) and nuances (how is credit age different from my actual age again?) to contend with. But, while there are certainly situations that call for outside help, there are also a few simple, free things you may be able do get results.

Remember, of course, everyone’s credit profile is different and what works for one consumer may not work for the other. The key, of course, is to understanding what factors specifically are driving your score. You can get an idea by viewing your free credit report summary each month on Credit.com.

1. Pay Your Credit Card More Often

Credit scoring models see large amounts of outstanding debt as a big red flag, even if you’re on-time with your payments. (The idea here is that you may be close to or already overextending yourself and new financing would push you over the limit.) If you’re consistently maxing out all or even one of your credit cards each month, your score would likely benefit, should you pay those balances down. (The general rule of thumb is to keep the amount of debt you owe below at least 30% and ideally 10% collectively and on individual credit cards.) If you can’t afford to pay off larger portions of your monthly purchases, you might still be able to improve your credit score by simply increasing the frequency of your payments. Most issuers report your balance as of your statement’s billing date, not due date, so putting some funds towards your bill each week could help ensure that a big statement total doesn’t wind up weighing down your score.

2. Check Your Credit

What you don’t know could be hurting you, so you will want to check your credit report. (You can do so for free each year on AnnualCreditReport.com.) There may be items in your credit file that you are unaware of (like, say, an unpaid medical bill) holding your score down. There’s also a chance you may find an error on your credit report (one in five consumers actually have one). Getting this information addressed or corrected could improve your score. You can find out more about why errors appear on credit reports and how to dispute them with the three major credit reporting agencies on Credit.com.

3. Get a New Credit Card

It may sound counterintuitive, but adding another line of credit could improve your score in a number of ways. For starters, most credit scoring models consider your mix of accounts in their calculations, so if you’re building credit exclusively off of an installment debt (like, say, your student loan) adding a revolving line of credit (like, for instance, a credit card with no annual fee) could bolster your score in the long term. Also, the credit limit associated with your new card could potentially lower your aforementioned credit utilization ratio (how much debt you owe versus how much credit has been extended to you.)

Of course, this strategy only works if you use your credit card responsibly, so if you do add a new one to your wallet, you should avoid running up a balance, and, if you do make any purchases, be sure to pay them off on time. Also, try not to over-course-correct and apply for a whole bunch of new cards. Doing so could leave you open to overspending and also may generate a few too many hard inquiries on your credit report, which can send your score in the opposite direction.

4. Asking Your Issuer for a Credit Limit Increase

In the same vein, asking an issuer to up the credit limit on on your current credit card could help put you under that 30% to 10% credit utilization rate — particularly if you’re just going over it. Just be sure, of course, to use that extra credit responsibly, if at all. (Note: this request, too, could generate a hard inquiry on your credit report.)

5. Wait

It doesn’t sound terribly exciting, but having a little patience with your score could be the simplest way to solve any credit problems. Negative information generally takes about seven years to “age off” of your credit report (bankruptcies can take longer), but effects will lessen over time. And consumers just starting out in the credit world may need some time to establish their credit history (and bolster performance in the “age of credit” category calculated by most major credit scoring models.) Of course, while you wait, you should focus on exhibiting and building smart spending habits. Paying all of your bills of time, keeping your amount of debt low and adding new accounts organically over time are good ways to build solid credit in the long-term.

More on Credit Reports & Credit Scores:

Image: iStock

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

  • Jeanine Skowronski

    Hi, Dena,

    It’s true that paying off a collection account can help improve your score. However, you don’t need to carry a balance on your credit cards to build a good score — and you can pay your bills off in full and have a balance show up on your credit reports, given the way issuers report to the bureaus (usually your statement billing date rather than statement due date.)



Credit.com receives compensation for the financial products and services advertised on this site if our users apply for and sign up for any of them.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team