Checking your credit score might have roughly the same urgency as going to the dentist. It’s easy to forget about it until there’s an issue. Maybe you need to get a credit card, take out a loan, or rent an apartment, only to discover that your credit score is too low for you to qualify.
After realizing you missed a payment or let credit card balances run too high, you might consider, “Can I fix my credit in as little as 6 months?” These simple strategies may put you on the path to boost your credit score.
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Calculating your credit score
Understanding the factors that influence your credit score will start you on the right track. First, identify what dragged down your credit score before focusing on improving your score. Here are some of the most common reasons why your credit score is lower than you might want it to be.
- Missed payments
- Late payments
- Using more than 30% of your available credit
- No credit history
- Applying for multiple lines of credit in a short period of time
- Closing one of your credit accounts
- Declaring bankruptcy
- Inaccuracies on your credit report
Help fix your credit score in as little as 6 months
Once you know what caused your credit score to drop, you can take the necessary steps to improve your credit score in as little as 6 months. Follow these top tips to get started.
Step 1: Obtain your credit report
First things first — get a copy of your credit report. On AnnualCreditReport.com1, you are entitled to a free credit report every 12 months from each of the main credit reporting agencies — Equifax, Experian, and TransUnion.
If you notice any collection accounts or small debts, pay them off as quickly as possible. Next, check whether your credit report is correct and dispute any inaccuracies.
Step 2: Create a plan
Take a close look at your credit report and identify areas where you can make improvements. More often than not, if you’re struggling with debt it’s probably time to sit down and create a budget.
Creating and sticking to a budget can help you get out of debt faster and manage your money better. Making a budget is actually easier than you may think. With a RoarMoneySM account at MoneyLion, you can access tools that can help you monitor your spending. Weekly spend reports provide insight into your typical habits, and you can quickly see what you want to prioritize.
Step 3: Pay down your highest debts
The golden rule of getting out of debt is to focus on paying down your highest and most expensive obligations first. Before you buy any new big-ticket items, call your creditors and ask them about adjusting payment schedules or dropping any late charges. You might even be able to negotiate a lower amount, as long as you make payments on time. If your creditors agree to any changes, make sure to get everything in writing.
In the meantime, pay more than the minimum required amount each month. This will help you pay off your debt faster, boost your credit score, and save you money in the long run. If you have any extra cash, you can put it toward the debt instead of buying new things.
Another good idea is to set up auto-payments. Putting debt payments on autopilot means you’re less likely to miss payments.
Step 4: Apply for a Credit Builder loan
It can be hard to work your way out of debt if you’re caught in a cycle of high interest rates. One strategy is to pay off high-interest debt with a low-cost, manageable loan. MoneyLion’s Credit Builder Plus could offer you just the ticket. Membership includes access to a loan of up to $1,000 that can help you save money and build credit.
You’ll receive a portion of the funds when you accept the loan offer, with the remainder held in your interest-bearing Credit Reserve account. It’s still yours, and you’ll receive it when the loan is paid in full.
Best of all, make your payments on time because that payment history gets reported to the three major credit bureaus.
Step 5: Monitor your credit
Actively monitoring your credit keeps you on track for improving your score. For instance, if you notice sharp drops in your credit score, you can search for the culprit. When you find an error on your credit report, you can work to resolve it.
You’ll be more motivated to stay on budget and pay down debt once you see the progress you’re making. It is a good idea to make sure to check in regularly and opt into updates.
Credit monitoring services don’t have to be costly. For example, if you have Credit Builder Plus, weekly credit score updates are included.
Step 6: Improve your access to credit
Following these steps over the course of six months should have a positive impact on your credit score. Not only could your score improve, but you may also have a better understanding of how to budget and how credit works. Plus, a new higher score may qualify you for more attractive rates on loans, credit cards, and other financing options.
Maintain your credit score
Once you raise your credit score, which may give you access to better lending terms, it’s still important to maintain many of the same money habits to keep your credit score up. Only take on additional debt if it makes sense for your budget. You never want to borrow more than you can repay.
Also, it’s a good idea to make sure you never max out your credit cards. You want to stay in the sweet spot with a credit utilization rate of 30% or lower. Continue to keep accounts with good credit history open and make sure to keep monitoring your credit score regularly.
Help improve your credit health in as little as 6 months
MoneyLion opens the door to a variety of tools that help you improve your credit score in as little as 6 months. Even if you have bad credit or no credit, Credit Builder Plus offers a pathway to build and improve credit. In fact, members have raised their credit scores by 42+ points within just 60 days!2
You’ll have access to up to $1,000 with MoneyLion’s Credit Builder Loan. MoneyLion will report your payment history to all three major credit bureaus. Making consistent payments gives you a good start toward a credit score boost. Plus, you’ll have access to other financial tools and perks like weekly credit updates and rewards.
Download the MoneyLion app to get started today!