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Increase your credit score in six easy steps

Responsible management could unlock a higher credit score

The average credit score is at an all-time high of 706. How does your score compare to the average?

A higher credit score gives you access to a wider range of financing options and helps you secure lower interest rates when applying for loans or opening new credit lines. There are a number of strategies to increase your credit score.

Keep track of your revolving credit usage

Revolving credit is a category that includes credit cards and lines of credit. With that type of credit, you can benefit from flexible financing solutions and charge more to a card or account whenever you need to make a purchase. You can pay off as much or as little as you want as long as you make a monthly minimum payment.

Using around 30% of your revolving credit will increase your credit score. Be mindful of what you charge and how much you pay off to stay as close to that 30% range as possible.

Make payments on time

Some credit card issuers have a grace period for missed payments or will waive late fees in some cases, but missing a payment will hurt your credit score.

Keep track of when payments are due and use your credit lines responsibly to avoid putting a strain on your budget.

Check your credit reports for inaccuracies

Equifax, Experian and TransUnion are the three credit agencies that collect information about your credit usage and compile your credit score. Each agency will send you a free copy of your credit report once a year.

Request a copy from those three agencies and look for errors or missing information. Contact credit agencies or lenders to dispute any inaccuracies or to have your credit report updated.

Take care of collection accounts

Do you have any old accounts that were sent to collection agencies? Your credit score can go down once a collection agency reports that they have acquired an old debt.

You shouldn't neglect collection accounts because you can lose a significant number of points if you have a high score or have a large debt that went to collection.

Contact the collection agency, negotiate with them to see if you can pay a smaller amount, and pay off your collection accounts or dispute the debt if it's a mistake.

Bring past due accounts current

An account becomes past due if you miss a payment. As late fees add up, more and more missed payments will hurt your credit score once a creditor reports it. This report typically occurs 90 days after the due date.

If you have any past due accounts, catching up should be a priority. Pay off the past due balances in their entirety, or contact the creditors to see if you qualify for a settlement plan.

Open a new credit line

Opening too many credit lines within a short period of time can hurt your score. Managing credit responsibly and opening a new line when you need one will increase your available credit Increase an existing credit line if the creditor affords that option.

Credit First National Association offers a wide range of flexible and affordable credit lines for automotive repairs and maintenance. You can apply for a new card online, increase your available credit and take care of unforeseen repair or maintenance costs while having enough cash left to keep up with your other credit line payments.

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