Improving your Credit Score Part 2

In our previous article we began our discussion on how to improve your credit score with the first two of nine steps provided by MSN Money.  Next we will discuss the third and fourth options for you to consider if you would like to increase your overall score.

3.  “Pay down your credit cards.”: Sometimes this is easier said than done, but if you are paying extra towards your installment loans (as discussed in the previous article), then discontinue that and pay that extra money towards your credit cards instead.  This will cause a more dramatic increase in your overall credit rating.  The larger the gap between what you are allowed to borrow on your credit card and what you have actually chosen to borrow dramatically affects your score.  It is important to make that gap as big as possible.  A goal would be to have your balances “below 30% of the credit limit on each card, and 10% is ideal.”

4.  “Use your cards lightly.”: According to MSN Money, “racking up big balances can hurt your scores, regardless of whether you pay your bills in full each month.”  Your credit rating is a reflection of what the previous months billed balance was.  Avoid making that number too large.  Safeguard yourself by having text alerts and/or emails regarding your credit card use.  This is especially important if multiple members of your family all utilize the same credit card.  It helps you keep everything straight to avoid surprises when the statement comes.

You can use your credit cars on service too and this provides you with an easy way to use your cards minimally and to be able to pay them down quickly to help boost your scores.  Contact your local new and used Toyota service department in St. Louis for an appointment today.