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Raise Credit Score

Monday, Jun 18, 2007

Question: I am trying to raise my credit score to buy a home. For the past three years I have paid everything on time, have low credit card limits and have not applied for new credit. Every account still open is in excellent shape- even the student loans. Previous bankruptcy (now 9 1/2 years ago) and a large amount of unpaid accounts have been closed or charged off, but are close to the seven year mark and should all come off this year. I am closely monitoring my score- but it is going down- its an average of 560. If everything recent is in great shape, why is my score not going up and rapidly?

Answer: Unfortunately, credit scoring is too complex a calculation for me to tell you specifically why your credit score is falling rather than increasing.

From your question, it sounds like you are doing many things well to improve your credit rating. However, since your score is falling, clearly there is some aspect of your credit profile which makes
you appear to be a credit risk. I do not know enough about your financial situation or your credit profile to identify what specific aspects of your credit history are causing your problems. It could be that the balances you are carrying on your credit cards are too large (are they over 33% of the credit line on each trade line, for example) or simply that not enough time has passed to diminish the negative impact of your bankruptcy and unpaid accounts.

Again, credit scoring is too complex a calculation for me to identify what is causing your credit score to drop. Hopefully, once
the bankruptcy and old accounts fall off your credit report, your score will begin to increase. Since your payment history accounts for 35% of your credit score and your debt load accounts for 30%, if you continue to make all of your payments on time and keep your total debt amount low, your credit score should increase with time.

To learn more about credit, credit reports, and credit scoring, I encourage you to visit the Bills.com Credit Solutions and Resources page at http://www.bills.com/credit/

I hope that the information I have provided helps you Find. Learn. Save.

Best,
Bill
www.bills.com

Also, make sure to get a free financial health check-up with Bills IQ!

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Bill has answered all sorts of questions and has been able to provide those in need of financial guidance with helpful and valuable advice and information on their specific financial area of interest. If you need specific guidance on any of the above mentioned financial areas, feel free to Ask Bill your financial questions and get better informed. Also, make sure to get a free financial health check-up with Bills IQ!

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