2 Steps to a Great Credit Score

Everyone can have a great credit score (750+.) How long it takes depends on from where you start. It will take a person with a 450 score longer than a person with 620. And both longer compared to a 720 score. But it can be done. The journey of 1,000 miles begins with the first step. Here are 2 steps to having a great credit score.

Step One STOP putting BAD news on your credit report.
If you do nothing, your credit will clean itself up in 7 years. The Fair Credit Reporting Act (FCRA) requires that.

• Once you commit to improving your credit score start paying your bills: On time; Every time; All the time.  Just one late payment can be devastating to a credit score for a long time. So, no more late payments--pay your bills on time--every time.
• Improve credit utilization ratios. You can do this by reducing debt and/or raising credit limits. Your credit utilization ratios significantly impact your credit score in both the Trended Data and various FICO credit scoring models; independent of your payment history.

Step One will “clean” your credit report of all negative references in a maximum 7-10 years depending on the negative tradeline type. But a clean report is only part of having a great credit score. You can take Step Two before you complete the first. And you should. Especially if you had a bankruptcy in the last decade.
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Step Two Put some good news on your credit report. Gotta Do It!
Current positive tradelines on your credit report have a greater impact on improving your credit score than older negative ones. They will improve your score faster and easier than just doing Step One alone. Here are some ways to put positive tradelines on your credit report.

• Lend yourself money. Then pay yourself back in a way that reports to the consumer reporting agencies. If you have either no score or a “bad” score you will find it hard to get credit. Financial services institutions are very reluctant to lend money to the “untried or unworthy.” So you must borrow from yourself with the assistance of a financial services instrument such as a (1)secured credit card or (2)self-collateralized installment loan from a credit union, bank, etc or (3)a Credit Builder account from Self Lender. The first two options require you to have money to get started. Self Lender Credit Builder account only requires you to make self-selected on-time payments. You’ll need no money upfront.
• Responsibly open and use new types of credit accounts. If you want a great credit score you must proactively manage it. Having and properly using credit when necessary can improve your financial well being. Educate yourself about credit scoring. Know how to move your score on purpose when you need it. Doing so can save you money on interest rates and result in more favorable terms when you borrow.

Bonus Step Repeat Step One and Step Two as needed.

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Credit Score improvement Chart