Friday, May 1, 2009

Making Amends in the Credit Report

You may have had a very bad credit history till date but that does not mean that there is no way to resurrect and to make amends in the credit history. Many Americans have improved upon their credit history after having had a pathetic credit score. It is not an impossible task to improve upon the credit score. Finances when managed well automatically lead to a good credit score.

The credit reports are constantly upgraded by the three credit bureaus. Although some negative credit activities stay in the credit reports for as long as 2 years and some for as long as 8 years, it does not mean that all efforts to improve the credit history would go in vain.

Experts have long been suggesting ways to improve the credit life. Some Americans have also made it a habit to check their credit report on a daily basis. This way they avoid inaccuracies in their credit report and can also keep a check on the credit fraud. Hence to make a good credit report one should follow the simple rules explained by those who have been into finances since a long time.

1. Keep low balances: Keeping low balances on your credit card has a very good impact on the credit history. Keeping the balance under 30% of the credit limit will definitely help enhance the credit score in the long run.

2. Avoid opening new accounts: you don’t want to be held guilty of trying to get a lot credit in a very short time. It may have a negative affect on the credit history. Hence opening new accounts may raise the credit-utilization ratio but this may just prove to be a wrong move and might increase the number of inquiries. There are no bonus points for opening new accounts. In fact closing accounts also does not affect the credit history. So the accounts that are not in use should be closed as soon as possible.

3. Have a long credit history: if you have had a good long credit history then that is definitely something to be proud of. That goes down in the credit report as a positive remark. This is something that can not be changed overnight so one needs to be patient and look at long term benefits while working on having a good and lengthy credit history.

4. Get your acts together and pay on time: This is the most important thing one can do to get a good credit score on the report. Paying off all the pending bills and outstanding debts will have a great impact on the credit score and it is likely to shoot up in such a case.

5. Get rid of false information: In case any false information is present in the credit history, it should be reported to the bureaus a soon as possible to avoid lowering the credit score for a mistake that was not committed by you.

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