Raising Credit Score

The most fundamental steps to hike credit score (beacon score) are to reduce the outstanding balance in the loan accounts, liquidating the high interest credit card debts, increasing portfolio of good credit over bad credits and avoid defaults in repayments.

Availing new credit is to be avoided as it brings down credit score at least for the short period. Though long drawn, these self-controlled debt management proves effective in fixing bad credit at no cost to the debtor.

Rapid Rescore

The errors in credit report obtained from credit bureaus may be real mistakes which if rectified would raise the credit score of a person.

In such a scenario, the credit service called rapid rescore program may come handy in updating the credit report information with the three bureaus. Apart from this, big changes in credit report to upgrade credit score can be done through rapid rescore programs when there is a considerable reduction in outstanding debt brought about by bulk repayment which the debtor wants to be reflected promptly in his credit report. However it is advisable to obtain credit report well in time and not defer credit rescore to the exact moment of need.

Credit Counseling

A debtor can lower his monthly payments through credit counseling. However one needs to be cautious before approaching this line. If minimum payment is not made in the accounts included for the purpose of credit counseling program, it would be shown as late payment and bring down the credit score.

The contract executed during credit counseling also prohibits any new loan account to be opened during certain period. As such condition precludes opportunity for availing even mortgage credit, one should be extra careful in entering into any contract with credit counseling companies.

Points to Remember

For fixing bad credit, the simple steps are liquidating the high cost unsecured debts first, focusing on resolution of the debts that contain seizure of assets in loan agreements, pay off defaults in respect of mortgage credit and improve credit report through rapid rescore programs.