BOSTON (CBS) – Q: How do I improve my credit score?
A: According to My FICO there is no quick fix to improving your score. The best advice for rebuilding credit is to manage it responsibly over time. First thing you want to do is get a copy of your free annual credit report for all of the information on your history is what is used to calculate your score. Your FICO credit score is comprised of the following:
Your Payment History 35%
Amount of Debt 30%
Length of Credit History 15%
New Credit 10%
Type of Credit Used 10%
So the best you thing you can do is pay your bills on time and if you have a problem doing that then have them automatically paid for you. Set up a reminder. Delinquencies count against you severely in compiling your score.
Do not max out your cards! The amount of debt you are carrying to the amount of credit you have available is important.
Keep those old credit cards. I have had one since the 1980s. I got it when I was 10! And use those old cards!
The number of new accounts opened is important. So if you are out shopping and the store says sign up for one our credit cards and you’ll get 10% off today, beware, it may not be a true savings if it affects your score.
Last, what kind of debt are you carrying? They look for a mix, which may not be possible for all consumers; credit cards, retail accounts, installment loans, mortgage, and consumer finance accounts.
Q: Do I have to pay a fee for my credit score? Is there a site I can safely use to get this? I understand I can get the credit report free but am interested in my score.
A: You do have to pay for your scores. There are sites that will offer them free but there is a catch. You will need to purchase something from them and give them your credit card number. Usually it is a credit monitoring service that they sell. Now I do know people who have gotten their scores free and then cancelled the service but I also know people who were stuck until they figured it out.
MyFico, a division of Fair Isaac the company that created the original credit score, will sell you copies of your credit scores for $19.95 each and they have good information on their website on how to improve your score.
You can hear Dee Lee’s expert financial advice on WBZ NewsRadio 1030 each weekday at 1:55 p.m., 3:55 p.m., and 7:55 p.m.
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