I was talking to a friend the other day who works for one of the Big 3 Credit Reporting Agencies and I asked him for a couple little nuggets of information on how to improve your credit profile. This is the insider’s information straight from the horse’s mouth.
Pay Your Bills Before The Statement Date
Basically the amount you owe on any particular debt is reported to credit agencies based on the balance as of the final statement date of the account. When you pay the bill before the statement date then the balance is lower when it is reported and that will affect your Utilization Rate in a positive way. If you’re not sure what a Utilization Rate is, it’s the amount of debt you actually have vs the theoretical amount of debt you could have if you maxed everything out. The lower the rate the better.
An example of using this tip would be if you had a credit card with a balance of $6000 with a statement ending date of November 1 and a payment due date of November 12. If you paid $1000 to the bill on October 28th then the debt reported to the credit agencies would be $5000 but if you paid the bill on November 12th then the amount reported would be the $6000 you owed on the statement date.
Ask For A Deletion
You never know unless you ask, right? If you have a great history and long term relationship with your bank or credit card issuer or lender but you just happened to have 1 or 2 hiccups along the road of life then you should ask for a deletion. A deletion is when the issuing makes a request to the credit agencies to remove a negative comment or event from your credit report. It all comes down to your history with the lender and even more importantly how you asked. Remember to be very nice and friendly to that customer service rep on the phone, thank them for all their friendly and wonderful service, let them know that after this call you would like to speak with a supervisor so that you could give that representative a compliment – YOU BETTER ACTUALLY GO THROUGH WITH IT AND GIVE THAT COMPLIMENT IF YOU DO THIS! All in all the point is you can catch a lot more flies with honey than with vinegar.
Here’s a quick 2 minute video from TransUnion on how to keep a healthy credit score.
- Pay Bills on Time
- Keep Balances Below 35% of Available Credit
- Maintain a Mix of Credit
- Don’t Rashly Cancel Cards Just Because Balance Paid Off
- Always Keep on Top of Your Credit Reports
How do you work towards keeping a good credit report?