Tips to Help Improve Your Credit Score

By Lauren Rosales-Shepard

Are you looking to boost your credit score? It might be easier and more straightforward than you think! In this post, we’ll lay out some steps you can take to achieve your goal.

While we aren't credit counselors, we are happy to provide some commonly shared general consumer information about credit in this article, as sourced from sites such as NerdWallet and Equifax. We highly recommend that you speak with licensed credit counselors or other experts if you have more questions.

What is a Credit Score?

Briefly, a credit score is a number meant to indicate how likely you are to repay borrowed funds on time, representing your creditworthiness to potential lenders. Lenders use your credit score not only to approve or reject your application for a loan, but to determine the terms and rates they want to offer you. Credit scores typically fall between the range of 300-850, with 850 being utterly perfect.

What Factors Impact My Credit Score?

There are several factors that affect your credit. Here’s a quick rundown:

• Payment History:

  Reflects whether you pay bills on time. Late or missed payments lower your score.

• Credit Utilization:

  The amount of available credit that you’re using. The less you utilize, the better for your score.

• Credit History Length:

  Longer credit histories suggest stability.

• Credit Mix:

  Having different types of credit (such as credit cards and loans) can help.

• New Credit Inquiries:

  Too many applications for credit in a short time can hurt your score.

How Can I Increase My Credit Score?

Rebuilding your credit can take time. Moving forward, here are some actions you can take:

1. Pay off debt:

   This seems obvious, and often much easier said than done. But bear in mind that late payments, even of a couple of days, can cause your score to drop significantly. Making regular, on-time payments improves your score, end of story.

2. Keep your credit card balances low:

   When possible, don’t just pay the monthly minimum!

3. Keep credit cards open:

   Even once you’ve paid off a credit card, consider keeping it open for a small recurring charge, like a phone bill or Netflix subscription, to keep the cards active. If you close a credit card, you might negatively affect your score.

4. Only apply for credit when you need it:

   When you apply for a new account, the lender might perform a hard credit pull, which may hurt your credit scores.

5. Dispute any inaccuracies on your credit report:

   You can do this one today! Start to regularly monitor your credit reports to make sure they’re accurate, and dispute any wrongful charges ASAP.

6. Ask to increase your credit limit:

   If you’re in good standing with a card, call to see if you can increase your limit. A higher limit lowers your utilization rate if you maintain the same balance

Resources to Help You Rebuild Your Credit

As we said at the beginning of the post–we are not credit counselors. If you have further questions, or would like more specialized help, we recommend checking out these resources:

• Credit Monitoring Services:

  Credit monitoring tools help track your score and alert you to changes or potential fraud. There are several free options available, such as Credit Karma and MyFICO.

• Financial Counseling Services:

  Nonprofit organizations offer free or low-cost advice on credit and debt management. Take a look at the National Foundation for Credit Counseling (NFCC) and the Financial Counseling Association of America (FCAA).

• Debt Management Tools:

  Managing debt effectively improves your score. Look for an app that can track your spending and debt payoff progress.

• Debt Consolidation Services:

  Consider working with a credit counselor or lender for consolidation loans.

• Educational Resources:

  Understanding credit is the first step to improving it. MyFICO.com offers detailed explanations of FICO scoring. The Consumer Financial Protection Bureau (CFPB) offers consumer guides on credit, loans, and debt. Local credit unions often provide free financial literacy programs and credit counseling for members, too.

• Professional Assistance:

  For complex credit challenges, you may want to hire a professional. Certified Financial Planners (CFPs) can offer a long-term strategy for credit and debt.

An Innovative Option for Debt Consolidation

If you have multiple sources of debt, you may find it difficult to keep up with the various monthly payments. Consolidating that debt streamlines everything into one monthly payment, making your financial obligations easier to manage.

Unison designed the Equity Sharing Home Loan to empower homeowners with financial flexibility. By offering a second mortgage with half the monthly payment as that of traditional home equity loans and lines of credit, we give you the ability to save on your monthly obligation–and use those savings however you wish! In addition, the Equity Sharing Home Loan has a 10-year term, and absolutely no prepayment penalties. With the convenience of a user-friendly online application, you can pursue your debt consolidation goals without added stress. Work with one of our licensed loan officers to start your application today!






The content on this page provides general consumer information. It is not legal or financial advice. Unison has provided these links for your convenience, but does not endorse and is not responsible for the content, links, privacy policy, or security policy of the other websites.