Building a good credit score usually takes a considerable amount of time, but you may be able to do it much quicker if you apply the right strategy. That is, in as little as 30 days. In a recent published USA Today article, it is said that a senior loan officer called Ted Rood has seen credit scores increase up to 100 points because of early bill payments. Here is a look at how this strategy works.
Timing is Everything
There are two factors that can have a significant impact on credit scores, namely, promptness of payment and credit utilization. Late payments do damage that can only be repaired over time. If you pay your credit card bills early, your balance will only be a small fraction of your available credit when it is reported to the credit bureaus. Credit utilization will stop hurting your credit score when the credit bureaus see a lower balance. So, paying early does have a positive effect on credit utilization. Credit experts recommend that you keep your balance below 30 percent of your credit card limit. The majority of people with the highest credit scores use less than 10 percent of their available credit.
If you are just a little off a credit score required to get a loan or better mortgage terms, you can pay extra and early to reduce your balance as much as possible. This is also worth doing if your credit score barely makes the cut, because scores have a tendency to fluctuate. According to Rood, this strategy is especially effective if a high credit utilization rate is the only blemish on your credit report.
How to Do It
It is important to make sure that your balance remains low throughout the billing cycle. This can be achieved by setting alerts to inform you that you have reached a certain level of your available credit, paying off purchases as soon as they are posted, and making micro-payments every week or two. If you are struggling to get your credit utilization rate below 30 percent, you may want to consider consolidating your debt by getting a personal loan to reduce your credit card debt. Alternatively, you can seek the assistance of a reliable credit repair company. According to an article published by Credit Repair Companies (www.CreditRepairCompanies.com), it is important to do extensive research when looking for a credit repair company, because there are many fraudulent companies out there.
Improving your credit score within 30 days is not impossible, but it also requires a substantial amount of effort and possibly sacrifices. With the right strategy and enough discipline, you should be able to achieve your desired score.