How to Boost Your Credit Score Quickly and a Few Ways Not To

In Part 1, we covered several good ideas for raising your credit score quickly. Now, be sure to avoid the following ineffective methods.

Disputing Every Bad Entry in Sight

This tactic is used by many of the more disreputable "credit repair" companies to saturate the credit bureaus with disputes about anything and everything. The disputed items are supposed to be removed from your file if the bureaus can't confirm them within 30 days, and the "credit counselors" then boast that they've actually cleaned up your file for you.

Of course, most or all of the negative items come back as soon as the original creditor confirms that they're correct. However, what might not come back are the accounts that may be helping your score. The creditors might not bother to respond to the bureaus' requests for confirmation, and matters could actually end up being worse than before.

Disputing too many items at once is an excellent way to convince the credit bureaus that you're filing frivolous disputes, which by law they don't have to investigate at all. To be safe, don't dispute more than three or four negative items at once, unless your disputes are related. And don't pay anyone a large fee for this service. You can do it yourself.

Creating a New Credit Identity 

This is another favorite of scam artists. They might use a deceased infant's Social Security number, or an individual might apply for a taxpayer identification number, which the IRS typically issues to businesses. Even if you do succeed with this strategy, you're stuck with a file that has no credit history, which can be almost as tough as having a file with bad credit. On top of that, it's quite illegal.

Closing Troublesome Accounts

Negative marks don't fall off your credit file any more quickly because you close accounts with which you are having problems. Delinquencies, charge-offs, collections, and other harmful records can remain on your credit report for 7 years, whether or not the original account is still open. Bankruptcies can be displayed for 10 years.

In addition, removing an account could actually end up making matters worse. Even if you've had problems with it, that account might be having a positive influence on your credit score. If it's one of your older trade lines, it could be helping to make your credit history look very long, and when it comes to credit scoring, older is definitely better. If it's a revolving account, its credit limit is factored into your overall debt utilization ratio. Closing the account could make your overall existing credit balances look larger because the ratio of credit used in relation to credit that you have available has now changed-for the worse.

Paying Off Collection Accounts

Believe it or not, paying off old debts can seriously hurt your score, because the payment can update the old account and make the negative look younger than it really is. This oddity in the credit scoring formula isn't meant to suggest (nor do we) that you shouldn't pay your old debts. Instead, you should negotiate with the creditor to get the account dropped from your report as a strict condition of your payment.

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