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Improve Credit Quickly!
Posted by GuestPoster in Personal Finances
While there is no true quick fix to improve credit, there are some strategies that you can implement to raise your score quickly.
One of the quickest ways to raise your credit score is by paying off debt. While paying off installment loans may raise your score slightly, to get the biggest impact, focus on paying off revolving debt.
The reason for this is that a large part of your credit score is determined by your “utilization” ratios. This means that you want to owe a relatively small amount compared to the available credit you have.
As an example, your credit score will be significantly higher if you owe $500 and have $25,000 in available credit than if you owe $500 and have $1,000 in available credit.
A good rule of thumb is to get your total utilization below 25% of your available credit. Although paying off the highest interest or smallest balance accounts may work for a debt elimination strategy, if your goal is to have the highest credit score possible, it is best to have each individual account under 25%.
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