Raise My Credit Score

When a creditor checks the credit on a potential debtor, this results in a "hard pull" on the debtor's credit report. Each hard pull results in a decrease in the debtor's credit score. Clustered hard pulls are supposed to be ignored as this is supposed to be evidence of the debtor shopping for a car loan, mortgage, and so on. Apparently, you did the hard-pulls at sufficient intervals that they fell outside of the algorithm's parameters and this resulted in the drop you saw.

The rationale behind the score drop tied to a hard pull is to give creditors a warning that the debtor is shopping for loans, perhaps due to the debtor being in financial distress. Unfortunately, it appears the algorithm lacks the subtlety to recognized the difference between a debtor shopping for a signature loan and an apartment, and treats all hard pulls the same.

The decrease you saw is approximately what one sees when missing a credit card payment, which is unfair and points out a weakness for creditors to rely on a single number when judging whether to do business with a potential customer.

I have several constructive on one unconstructive suggestion. Here is my unconstructive suggestion: The next time you shop for an apartment or car loan, go to AnnualCreditReport.com and get a copy of your credit report. Make copies of the entire report, and when applying give the landlord or finance person a copy of your report. Do not give them permission to make a hard pull on your credit report until you are ready to make the final deal.

Here are my constructive suggestions and steps you can take to help improve your credit score:

1. Pay off all debts and keep revolving lines below 25% utilization (and certainly don't "max out" any loans or cards)

2. Get a small store card or gas card or credit card and make payments every month (this will help you re-establish a track-record of positive payment history)

3. Get your credit report from AnnualCreditReport.com and contest any inaccurate information so that it can be corrected by the credit bureaus. See the Federal Trade Commission document FTC Facts for Consumers: How to Dispute Credit Report Errors for instructions on correcting any errors you may find.

To learn more about credit reports and credit scoring, I encourage you to visit the Bills.com Credit Solutions and Resources page.

I hope this information helps you Find. Learn & Save.

Best,

Bill

www.bills.com/