Top 5 Ways to Raise Credit Score in Ontario California
Top 5 Ways to Get Better Credit
Here’s how I raised my credit score by 330 points in 1 year
Many people think having a good credit score is only for the wealthy. That might of been the case in the past, but today with all of the free resources available, there is no reason to not have good credit. Even those with low incomes can have good credit as long as they listen to the right advice! So how do you build credit in Ontario, California?
What are the biggest things that affect credit scores? Age of oldest credit line, percentage of on time payments, debt to income ratio, and number of credit lines are some of the biggest factors. If you focus on improving each of these things there’s no way your credit score won’t go up.
Is it possible to go from bad credit to good credit in a year? In this article I will show you the top 5 LOW COST OR FREE things I did to make my credit go up by 330 points in only one year.
1. Join CreditKarma.com
This site is the site I used to get critical information on my own credit score. With their free app you can check your credit daily for free without hurting your score, see which credit cards you’re the most likely to get approved for, and see breakdowns of why your score is the way it is. It will even show you which factors are hurting you the most! This is the best tool out there that I’ve used for building my credit. For more information, create a free account and try it out!
2. “Authorized user” Loop-hole
Many people that have bad credit never tried to get good credit because they have a family member or spouse that has good credit. That way they can just get loans in their name. If only they knew that if they had that trusted family member with good credit add them as an authorized user on one of their credit cards, it would boost their score tremendously. This works because it adds all the information about that credit line to the authorized user’s credit history. Meaning the age of the credit line, credit amount and percentage of online payments for your family member’s credit line will automatically be added to your credit report! This will add an easy 50+ points to your score.
Sounds too good to be true right? Here’s the best part. You don’t ever have to know what credit card your added to. You don’t have to even physically have a copy of the credit card. Or even use the credit card yourself! As long as your family member activates the card, makes one purchase with it, and keeps you as an authorized user, you will always have the history on your credit report. Ever see those ads saying they can boost your credit? This is their number one tactic.
3. Get a credit card
There are those out there that are religiously against credit cards. If you are that person then having great credit might not be for you. Now that I have that out of the way, let’s talk about it in more detail.
If you have extremely bad credit (score in the 400s-500s) it will be really hard for you to get a credit card or any credit at all. The best thing you can do is to get a secured card. A secured card is a credit card with no risk to the banks. This is because they require for you to make a cash deposit in order to open the card. That way if you don’t pay your bill the bank isn’t out anything. You can start with as little as a $250 limit card. My favorite secured card is offered by Capital One. The great thing about their card is you can convert it to a regular credit card once your score is better. Once you pay your bill on time for a few months in combination to becoming an authorized user on a friends card, you should be in good shape very soon!
If you have fair credit (in the 600’s) you should get more credit cards. The more credit you have available the higher your score will go. Most people will say having 3 to 4 credit cards is the sweet spot, but I haven’t found the exact number personally.
In addition to building credit, you will earn cashback rewards (FREE MONEY!) with most cards. This is a win win as long as you pay your bill in full on time every month. I get 2%-4% cash back on every purchase I make! Simply use your credit cards in place of your debt card, it really adds up. In fact, last christmas my wife and I didn’t pay a dime on christmas presents. All we did is use our credit card points we racked up all year on everyday purchases to buy all of our loved ones presents. Who wouldn’t like to give all of their family christmas presents without paying for them? If it’s free it’s for me!
4. Get a personal loan
A personal loan is a loan you can get for really any reason. They include car loans and small business loans for example. Some people might be turned off by the interest. You might ask, “What will I do with the money if I really don’t need a loan in the first place?”
Here’s how it works. Get a personal loan for a small amount like $2,000 to $5,000. Once you get approved, and the check comes in the mail, pay off the whole loan except $100-$500 IMMEDIATELY. From that point on, your payment will be so low that the interest you pay will be next to nothing. Keep making the small monthly payments every month on time, and you’re golden!
By following these steps, you will raise your credit in several different ways! You’ll have more open lines of credit. You’ll have many more on time payments. You’re debt loaned to debt owed ratio will be better. The best part? You barely pay any interest!
5. Refinance any current loans
This is the last and final step you will need to take advantage of. This works best after you’ve raised your credit by a decent amount. When I bought my first car I had no credit. The banks loved giving me a 24% interest rate! After 6 months of building my credit with all these steps, my credit score increased by about 150 points. I then went to my credit union Wescom in Ontario, California and refinanced my car to a 3% interest rate! Not only do I get to pay less interest but my first loan gets listed as “paid early” & “100% paid off” on my credit report AND the new loan added to the number of lines of credit! It’s really a win, win!
As you can see, building your credit isn’t as hard as people think. There are so many resources out there for people with bad credit. The better your credit gets the easier it gets to get better credit like a snowball effect. The key is getting an early start and creating good habits. If you’re looking to build credit in Ontario California, follow these steps and share your results! If you find this article to be beneficial don’t hesitate to press the social icons to the left to share!