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Raising Your Credit Score

Posted August 22, 2012 in Altoona, Advice Column, Pleasant Hill

The higher your credit score, the lower your interest rate possibly can be. There are things you can do or not do to help your credit score.

One mistake I see people make with their credit score is that they go on the Internet and they plug in their Social Security number to see what they can find out about their scenario and the interest rate. One evening online can end up with a person having had his or her credit pulled five or six times because that information was given to an online company that pulled their credit. If you know you have good credit, don’t have your credit pulled until you have made your decision about what company you are going to use to purchase or refinance your home.

There are great stores that offer 10 or 20 percent discounts if you open the company’s credit card. I see this every month. You just wanted the discount on your purchase, but it involves a credit pull to get that discount on your credit score. If you have been thinking about refinancing or purchasing your home, try to avoid this situation and do not open any new lines of credit about four months prior to your refinance or purchase.

Do not have a late payment that is reported 30 days or more late to your credit. If you have made a late payment, you must wait 12 full months before you can refinance or purchase. Of course it is best to not have any lates on your credit report. You should always shoot for on time when making any and all payments.  Setting up auto-deduct payments is a great way to do this.

Sometimes I come across a credit score that needs to be raised to qualify for a loan. If you have a credit card that has a zero balance, I will tell a borrower to charge a tank of gas or a small item and pay the bill off in full every single month. It is always best to not carry a balance on any credit card from month to month. If you are doing this all the time anyway, your credit score will be fine. But it is a good tip to keep in mind when and if you need to help raise your credit score.

Do you have a lot of debt and don’t know where to start? My advice would be to start with the smallest bill and work your way up one bill at a time, while paying all on the due date, but work toward paying off each and every bill one bill at a time, paying extra on the smallest bill until you conquer all of your debts.

Information provided by Lori Slings, Valley Bank, 160 Adventureland Drive, Suite H, Altoona, (515) 967-4700, lslings@valleyb.com.





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