According to a 2019 study by ValuePenguin, the average credit score in America is 695. A credit score of 695 out of 850 is good. But if you want to get approved for a mortgage loan and get the best interest rate, you’ll need at least a 750 credit score.
In this article, we provide some quick tips to get a 750 credit score.
Get a free credit report at Credit Sesame.
Check out: 5 Signs You’re Not Ready To Buy A House
If you haven’t done so, it’s a good idea to get a free credit report at one of the credit monitoring services like Credit Sesame.
Doing so is crucial as you have an understanding of your credit score and what types of things you need to work on.
How to get a 750 credit score:
1. Fix errors on your credit report.
You’re likely to see an increase in your credit score after you fix an error in your credit report. Usually, agencies that collect data for the credit bureaus make mistakes. Or you’re simply might be a victim of identity theft. For more information on how to file a dispute, read: How To File A Transunion Dispute.
Either way, it’s up to you to review your credit report and fix those errors.
The best way to correct inaccurate data on your credit report is to actively monitor your credit report.
Go to CreditSesame to get a free copy of your credit report.
2. Keep your balance below 30%.
In order to improve your credit score to 750, you really want to keep your balance under 30 percent.
Indeed, one of the factors the credit bureaus look at is ‘credit utilization.’ Your credit utilization is how much credit you’re using divided by the total amount of credit available.
For example, if you have $5,000 in credit available, and you have a balance of $2,500, then your credit utilization rate is 50%.
So in order to keep your balance under 30 percent, your total balance shouldn’t exceed $1500.
One way to keep your credit utilization under 30 percent is well, by not spending too much and pay down your credit card debts. Another way is to increase your credit limit.
Simply, call your credit card provider and ask for an increase. Have a number in mind and be ready to give a good reason why you need such an increase. You will need to provide information as to your annual salary, the amount you pay in rent or mortgage, etc…
3. Make Payments on time.
Missing payments on your credit cards can negatively affect your credit score, hence preventing you from getting a 750 credit score.
In fact, payment history accounts for 35% of your total credit score. One way to make sure your credit cards, student loans, or utility bills, are paid in a timely manner is to set up automatic payments. Although credit card providers are very good at sending you payment reminders 3 to 5 days before a payment is due, you should set up automatic payments for yourself.
So to get a 750 credit score, set payments to be automatically debited from your accounts so you can rest assured your payments are made on time.
4. Don’t Cancel any of your credit cards.
After you pay off your credit card debt, the most logical thing you might do is to cancel your credit cards. This is a big mistake.
Part of a getting a 750 credit score is determined on how much credit you use. So the more credit you have, the higher is your credit score.
Cancelling a credit card lowers your credit score, because you no longer have that credit available.
So, even if you pay off your credit card debt, keep your credit card open. Use it sparingly and don’t over 30 percent. You can also apply for a new credit card, but do not over do it. Applying for too much credit at the same time can lower your credit score.
Bottom line is getting a 750 credit score is not easy and takes time. However, if you implement these tips mentioned above, you could well be on your way! But the most important thing to keep in mind is to keep your credit report as clean as possible.
Related articles:
- How to Raise Your Credit Score to 850
- What is a Good Credit Score
- How to Check Your Credit Report for Free
Work with the Right Financial Advisor
You can talk to a financial advisor who can review your finances and help you reach your saving goals Find one who meets your needs with SmartAsset’s free financial advisor matching service. You answer a few questions and they match you with up to three financial advisors in your area. So, if you want help developing a plan to reach your financial goals, get started now.
Is it bad to do debt consolidation , will that hurt my credit .
It’s never a bad idea to consolidate your debt. In fact, it can be a good one, because it can lower your interest payment.
Whether it will hurt your credit depends on how you choose to consolidate your debt. if you already have 0% interest, balance transfer credit card, then you can roll all of your credit card debts into it without having to apply to a new credit card.
However, if you’re going to apply to a personal loan to consolidate, they will have to run your credit. However, a credit inquiry alone will not hurt your credit score.
I hope that helps.