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Every day, the words “raise your credit score 100 points overnight” get typed into internet search engines. Users might be trying to buy a house or even a buy a car. Perhaps they just found out they were declined for credit and learned their score is a lot lower than they thought it was—or lower than it needs to be.
While there are plenty of scams out there that promise to raise your credit score by 100 points overnight, the truth is that it’s nearly impossible to do so. What you can do, however, is focus on a more realistic goal. You can raise your score 100 points over time—and in a lot less time than you might think—by using a slower and steadier process.
The Myth: Raising Your Credit Score 100 Points Overnight
The reality is that you can lower your credit score by that much overnight a lot easier than you can increase it. If you apply for several credit cards in one day, for instance, or do some car shopping and let more than one dealer run a hard inquiry, you could see a significant drop in your score. If you close a few credit cards and skew your debt utilization ratio, you will also see a decrease in your credit score as soon as those closures hit your report.
There are some rare cases in which it is possible to raise your score 100 points overnight, but they’re few and far between. If you have excellent credit but have one bad item being disputed, once that error is removed, your score will jump after being recalculated without the disputed item. If you happen to suddenly be able to pay off multiple debts through an inheritance or other financial windfall, you could also see your score increase.
These aren’t everyday occurrences, however, and they shouldn’t be relied on to suddenly boost your credit rating.
The Reality: Raising Your Credit Score Over Time
The best way to raise your credit score is over a set period of time using smart strategies that will help you build a solid history. While they won’t get you where you need to be overnight, they’ll definitely start helping quickly.
Pay Your Bills on Time
The importance of making on-time payments cannot be overstated; it’s the single biggest factor in your credit score. If you have past-due accounts, get them current as soon as possible. Call the creditor, work out a payment plan, and then stick to it.
Dispute Any Errors or Frauds
It’s critical that you take a look at your credit report and ensure that everything is correct. Even a wrong address, middle initial, or other small detail can result in your credit report reflecting someone else’s data, and therefore should be disputed. If you’ve paid something off and it’s not showing as paid, that can also negatively affect you.
Reduce Balances on Revolving Accounts
Next time you reach for your credit card, think twice. Using over 30 percent of your available credit is a fast way to force your score downward. If you’re already spent over 30 percent, pay it down as fast as possible.
Only Apply for Credit When Necessary
Just because you’re offered a great new credit card with lots of perks doesn’t mean you need to apply. In fact, you shouldn’t apply for any kind of credit unless you absolutely need it—and in most cases, a new couch or family vacation doesn’t really count as a need.
Use Credit Cards for Your Bills
If you want to build up a solid payment history quickly, you could set aside a credit card only for your monthly bills and pay it off every month. In order for this to work, however, you’d need to keep any and all use of that card limited to the bills you pay each month—and ensure it’s paid off every single month.
Pay Off Anything You Can
If you have the ability to pay off a credit card, pay extra on a car loan, or otherwise work on decreasing your debt, do so. Don’t close any credit card accounts, just get them paid off as quickly as possible. Think about passing up your favorite latte four days a week and using the money to make an extra payment per month.
Unfortunately, you likely can’t raise your credit score 100 points overnight. You can, however, raise it even more than 100 points—if you’re willing to take the time to do it right. Take the time to check your report for errors, pay off any outstanding debt, and make all of your monthly payments on-time.
Author: Jeff Gitlen