Improving your credit score is important especially if you are trying to buy a house through a home mortgage. Whether you have a poor credit score or want to increase it, here’s what you should do:

1. Pay off or pay down your credit cards. Paying off your instalment loans could help your credit score but the effect is not as dramatic as that of paying down or paying off your revolving accounts such as credit cards. The FICO scoring and even the Vantage scoring system now weights credit card more heavily. Your individual card and your total revolving line should be below twenty-five percent. If you wish to increase your score, consider keeping those balances down over higher interest to obtain the most improvement on your score.

2. Do not use all your credit line in a month, even if you are able to pay your balance in full. If you are going to use your credit limit to the hilt, this could hurt your score. If you have to use all your credit line in a month, you may want to consider getting another card to even out your credit lines.

3. You can ask a trusted friend or your family member to add you to one of his or her old cards as an authorized user, much preferable if the card has not been used for a while. The older your credit history, the better, for example if your mother agrees to put you as an authorized user on a card that she has for twenty years or more, your credit score will soar up dramatically.

4. If you have been a good customer for several years but had once a rough time and missed a payment, you could ask your creditor to delete a negative listing. You will be able to do this with a goodwill letter. Your lender may or may not agree to this, but this method has been successful in improving credit scores.

5. If you defaulted on a student loan or missed payments, you can enter into a “rehab program” which could get your account back on track after a year.

6. Ask a collection agent to remove a debt from your credit report if this is already paid. This method is known as “pay for delete” and it works wonders on smaller amounts of under $500, especially medical collections. Get the agreement in writing before you pay anything and only send the money after they agree.

7. Credit services like the Equifax will provide you a tool that will let you dispute any account. Write your reason for your dispute. Bear in mind that disputes usually drops your credit score but increases after the changes are made to your account.

8. Write a letter to your creditors. They are people like anyone else who understand that things could sometimes get tough. Your letter should state your wish to have your status changed for a compromise of payments such as payment plan for the negative entry to be removed from your records.

9. Monitor your credit score. You can do this by signing up for an auto monitoring where you can receive notifications if your score changes or someone is inquiring about your score. Report any suspicious activity on your credit and continue sending letters to creditors who refused to give you a break.

10. Pay all your bills on time. If you have revolving credit accounts, ensure that you make your payments promptly. If you do not have any credit, wait for six months to apply for a low limit card.

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