How to Improve Slow Credit

If you have "slow credit," it means that your credit report shows that you regularly pay your bills late, according to ABC affiliate 13WHAM News. This will lower your credit score, which is a three-digit number ranging from 300 to 850. With low credit scores, you may pay more for all forms of credit, including automobile loans, mortgages and credit cards. Improving your score will require time and patience. The Federal Trade Commission (FTC) says that bad credit cannot be fixed in just a few months, despite claims made by some credit repair firms.

Instructions

1

Pay your bills on time. Never missing a payment is an effective way to increase your credit score. The myFICO website says that more than a third of your credit score is determined by your payment history, which is the most important category in the FICO scoring model. Any other move you make to improve your credit could be offset, at least temporarily, by one missed payment.

2

Pay down your debt. Maxing out your credit cards can cause your credit score to drop. MSN Money says you should pay down your revolving credit balances to below 30 percent of the credit limit on each account. Keep the balances below the 30 percent threshold as you continue to make timely payments. Examples of revolving credit include credit cards, some signature loans and home equity lines of credit.

3

Review your credit report for mistakes that could be pulling down your score. The Fair Credit Reporting Act requires the credit bureaus to remove any inaccurate information on your credit report if you notify them. Get a free annual copy of your report from all three reporting agencies at AnnualCreditReport.com (see the Resources section).

4

Write a letter to the credit bureau at its address on the credit report disputing any inaccurate information. If you have proof of the error, the information must be removed within about 30 days of the credit bureau receiving it, explains the FTC website.

5

Open a secured credit card if you are turned down for a regular, unsecured card. Secured credit cards require you to place money in a savings account that is held for collateral. The amount on deposit becomes your credit line. Unsecured credit does not require collateral beyond your signature. Using your secured card regularly, while staying within your balance on account, may help to boost your credit score.