You can increase your credit score by paying your bills on time, keeping a relatively low balance on credit cards and having a longer credit history with multiple accounts, explains MyFICO. The amount of debt held relative to your total credit limit is also important to understand. Creditors view borrowers who max out credit cards as not able to handle debt responsibly.Continue Reading
There are five elements that make up a FICO credit score, according to Yahoo! Finance. Payment history accounts for 35 percent, amount owed accounts for 30 percent, the length of credit history accounts for 15 percent, and new credit and credit mix account for 10 percent each. One of the top immediate ways to fix a credit score is to make consistent, timely payments, notes MyFICO. Paying just the minimum amount due by the time of the due date on a credit card each month satisfies the payment history portion of the credit score and prevents one of the most damaging marks from appearing on your credit report.
Credit users should not owe more than 30 percent of the individual credit card's limit, advises MyFICO. The length of time that a credit account has been open also affects a credit score, because it gives lenders more of a history to draw on when considering a loan or line of credit. For both of these last two reasons, MyFICO recommends that users don't close unused credit cards. When borrowers close card accounts, they reduce their overall credit limit, thereby increasing credit utilization and allowing for fewer accounts and less of a credit history to review.Learn more about Credit & Lending