8 Ways To Improve Your Credit Score and Get That Apartment
Although Flip makes searching for an apartment simple and hassle free, it can still be difficult to find you’re dream apartment if you’re struggling with a bad credit score. But that doesn’t mean you have to live in a hovel. If you take some time and implement a strategy, you can improve your score and secure an apartment you’re happy to live in. These 8 tips will help you regain control of your credit score and get on the path to financial stability.
1. Use Your Credit Cards Sparingly
One of the biggest factors contributing to your credit score is the balance on your credit cards compared to your credit limit. Ideally, you want to carry no more than 30% of your credit limit on your cards. So, if you have a $1,000 limit, you should try to keep the balance lower than $300. If you’ve already racked up a high balance, don’t panic. You can start to do some damage control by putting a halt on your spending.
First of all, take your credit card(s) out of your wallet and leave them at home. You want to use those cards as little as possible, and spread out the spending over all of your cards. Next, if you have any bills that usually come out of your credit card, transfer those payments to a debit card. The goal is to completely stop spending so you can begin to repair your credit.
2. Review Your Credit Report for Errors
If you are searching for an apartment, it’s important that you make sure your credit report is accurate. Request a copy of all three of your credit reports (Experian, Equifax, and Transunion) and go through them line by line. Make sure there are no errors. You want to check for accounts that do not belong to you, late payments that you remember having made on time, and any accounts in poor standing that are more than ten years old (as these can be removed to improve your score).
3. Keep old Accounts on Your Report
Note: this is only for good accounts and data. If you have a credit card or revolving line of credit on your report that is older than ten years (as mentioned above), you may be tempted to remove it. If it’s an account that was in good standing, it’s actually beneficial to keep it on the credit report. The length of your credit history has a positive impact on your credit score.
4. Negotiate With Creditors
If you have accounts that have gone to collections, they can do some serious damage to your credit score. Instead of just paying them down as you can, you can call the creditors and explain your situation. If you can pay off the collection amount, ask your creditor if they will change your standing to “paid as agreed,” or even remove the account from your credit history altogether. Collection agencies want to close out your accounts. They are frequently willing to negotiate and help you get your credit score back on track.
5. Pay More Than the Minimum
If you always pay the minimum on your credit cards, it will likely take you years to pay them off. And you’ll even end up paying more in interest than the original amount on your card. This means you’ll continue to carry a high balance, which will hurt your credit score. Try to double the minimum payment each month. If you do have to make the minimum payment, then try to make a second payment at some point during the month. Even if it’s just $10, these extra payments will help decrease your credit card debt and increase your score.
6. Pay on Time
The best way to improve your credit score is to consistently make all of your payments on time. If you have a hard time keeping track of everything, you can create a calendar with all of your payment due dates listed. Alternatively, you can create an account on a website like Mint.com to help keep track of your payments.
7. Ask for a Higher Credit Limit
If you have a decent (but not shining) credit score, you may be able to ask for a higher credit limit. This can help your score in the short term. But ONLY do this if you are positive that you won’t use the extra credit, because that will only decrease your score even more.
8. Become an Authorized User on Someone Else’s Credit Card Account
The last tip is actually really useful and can add years of positive credit to your account. Just add your name to a someone else’s existing credit card account, and that card’s credit history will appear in your name and on your credit report. Make sure you choose someone who has their financial accounts in order, like your parents, if you are lucky. The linked account should have a strong credit history, so that it reflects well on your credit report. But don’t fret, if the account you link up with turns out to have a nasty knack for spending, you can easily remove yourself as an authorized user, and this history is erased.