It's been a long journey of boosting my credit score - I'm currently signed up with Credit Sesame and get tons of helpful tips from them on how I can do this more effectively. But my question is - is it better to pay off credit cards slowly or all at once? 

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Great Question! According to the research that I've done and my experience with helping people remove errors from credit reports, the more you pay and the sooner will reduce your utilization rate the moment it posts (subject to next update of credit reporting) so "all at once" would quicken that for you. The rest of the factors, as you will read in this recap article, are not affected. The sooner you pay the less interest you are paying; however, to avoid needing credit and having to pay dearly for it, make sure to have some liquid savings available and then zap every other dime and dollar to become debt-free. This should help you find YOUR comfort level: https://www.thebalance.com/fac...-credit-score-960527

 

If you can afford to, all at once! It stops the bleeding immediately. By bleeding, I mean all the interest that's tacked on each month. If you can't do it all at once, definitely cut off the highest interest one first, by paying the minimum payment required on the lower interest rates and throwing the excess on the highest interest one. Once you've reached zero balance on a card, just leave it at $0. You don't need to use it and you definitely shouldn't close it because closing that account usually results in -40pt or so. 

If you're just establishing credit, a secured credit card might be good. They usually make you pay a deposit to start the card, then after a certain amount of successful payments, they give you the deposit back plus interest and you graduate to a way better credit card with a better APR.

@Briana I used to work for a credit card company! Some of the best ways to quickly boost credit scores. 

1) Don't close credit cards, especially your oldest one.  Instead you can just shred the card if you never intend to use it. This keeps your credit line open on your credit report.

3) Ensure you have enough credit, this sounds counter intuitive but having the right amount of credit in good standing shows that you can handle it and helps in the algorithm, even if you pay it off every month.

4) Carry a small balance month to month.  It makes that balance show up on your credit report and shows you use your credit and pay bills on time

5) Payments over 30 days late show up on your credit report. If you have recent late payments call the companies and see if they will remove it from your report (first time offense) this will not always work but it never hurts to try.

6) If you have debt at a collection agency, first send a certified letter asking them to verify the debt, this is the law, they must verify it when asked, a lot of collection agencies wont even go past this because it is too much trouble.  Once verified, send a certified letter with an offer to settle the debt, give them a number and add a clause to remove the report to the credit agency.  Collection agencies buy debt at pennies on the dollar then add ridiculous interest to inflate the debt.  Offer thousands less, they will usually counter with a much better amount then they are asking for.

7) Get your free credit report every year. I always do it in December, look for any discrepancies and challenge them. Use the official government site www.annualcreditreport.com

Hope that helps!

@Briana I used to work for a credit card company! Some of the best ways to quickly boost credit scores. 

1) Don't close credit cards, especially your oldest one.  Instead you can just shred the card if you never intend to use it. This keeps your credit line open on your credit report.

3) Ensure you have enough credit, this sounds counter intuitive but having the right amount of credit in good standing shows that you can handle it and helps in the algorithm, even if you pay it off every month.

4) Carry a small balance month to month.  It makes that balance show up on your credit report and shows you use your credit and pay bills on time

5) Payments over 30 days late show up on your credit report. If you have recent late payments call the companies and see if they will remove it from your report (first time offense) this will not always work but it never hurts to try.

6) If you have debt at a collection agency, first send a certified letter asking them to verify the debt, this is the law, they must verify it when asked, a lot of collection agencies wont even go past this because it is too much trouble.  Once verified, send a certified letter with an offer to settle the debt, give them a number and add a clause to remove the report to the credit agency.  Collection agencies buy debt at pennies on the dollar then add ridiculous interest to inflate the debt.  Offer thousands less, they will usually counter with a much better amount then they are asking for.

7) Get your free credit report every year. I always do it in December, look for any discrepancies and challenge them. Use the official government site www.annualcreditreport.com

Hope that helps!

These are all great tips! Thank you so much! I was always questioning whether I should close one of my cards or not, so now I have my answer. 

@Briana It is a balance, you want to keep your credit utilization low, you don't want to have too much credit, and you don't want to have too little If you have too much then closing an account is fine, just don't close the oldest one, that is actually a factor in calculating your score (at least in the older models).

I suggest using something like creditwise from Capital One, its free, you don't have to have an account with them and it gives you tips!

I was always told to stay away from credit cards. Even as an adult, I had moved out of the house and lived on my own for 7 years without having a credit card. So what I struggle with is lack of credit. I got my first credit card a year ago and then a few months after that, I bought my first car that required a loan. I have a decent score but hardly any history. I guess I just have to play the waiting game?

All at once is the best way to go! We did it, and we've never regretted it for a minute. We'd rather have that money going into the bank every month than into interest to another bank for what we borrowed. After the crash, the banks raised everyone's interest rates with promises to lower the rates. This wasn't the case. By taking away that interest payment on what you had borrowed, you're not only showing that you can get out of debt, you're showing your disapproval with the way they lied and cheated you for years after 2008.

 

Wen Dee posted:

I was told to negotiate with the creditor , many debts are sold for pennies on the dollar and the credit company sometimes will settle for a lower amount. Can't hurt to ask, never know what the company will say.

 

Some banks are flexible with this such as Discover. Others such as Chase will not lower your APR. I recently negotiated with Discover and they agreed to do a 6 month hardship at 9.99%, which is nearly half my previous APR. It has really helped me zero in on paying off that debt!

Briana posted:

It's been a long journey of boosting my credit score - I'm currently signed up with Credit Sesame and get tons of helpful tips from them on how I can do this more effectively. But my question is - is it better to pay off credit cards slowly or all at once? 

There are also credit score stimulators online which can help you when debating how quickly and how much you want to pay off. For instance, you can plug in reducing your debt by $1,000 v. $5,000 and it will tell you how much your score will go up. Great for planning whether you want your money to go towards debt or emergency funds.

Drumtrip posted:

@Briana I used to work for a credit card company! Some of the best ways to quickly boost credit scores. 

1) Don't close credit cards, especially your oldest one.  Instead you can just shred the card if you never intend to use it. This keeps your credit line open on your credit report.

3) Ensure you have enough credit, this sounds counter intuitive but having the right amount of credit in good standing shows that you can handle it and helps in the algorithm, even if you pay it off every month.

4) Carry a small balance month to month.  It makes that balance show up on your credit report and shows you use your credit and pay bills on time

5) Payments over 30 days late show up on your credit report. If you have recent late payments call the companies and see if they will remove it from your report (first time offense) this will not always work but it never hurts to try.

6) If you have debt at a collection agency, first send a certified letter asking them to verify the debt, this is the law, they must verify it when asked, a lot of collection agencies wont even go past this because it is too much trouble.  Once verified, send a certified letter with an offer to settle the debt, give them a number and add a clause to remove the report to the credit agency.  Collection agencies buy debt at pennies on the dollar then add ridiculous interest to inflate the debt.  Offer thousands less, they will usually counter with a much better amount then they are asking for.

7) Get your free credit report every year. I always do it in December, look for any discrepancies and challenge them. Use the official government site www.annualcreditreport.com

Hope that helps!

 

I have learned that since there are so many ways to help increase your score, focusing on one area and taking baby steps has helped me! Right now, I a focusing on minimizing my utilization of credit. I try to pay more then the minimum payment and then not touch the cards! I have already seen significant increase in my score in a short period of time! 

MarieS posted:

I have learned that since there are so many ways to help increase your score, focusing on one area and taking baby steps has helped me! Right now, I a focusing on minimizing my utilization of credit. I try to pay more then the minimum payment and then not touch the cards! I have already seen significant increase in my score in a short period of time! 

@MarieS You can feel proud of yourself for doing that. Many people have a hard time with it because their spending is so out of control.  

I have never heard of that but I have always said how amazing it is that we are not able to include our household bills to establish payment history and credit worthiness! They definitely pull our credit to determine deposit information!!!! Definitely will check this out! Thanks for sharing! 

Prince_Alarming posted:

Another way to help boost your credit is, Experian Boost. I'm not trying to advertise or anything like that, just passing on some good solid info.

Experian Boost is free. It uses you electric bill, cell phone/home phone to help boost your score. Just thought I'd pass this on.

I never heard of that.   That sounds great!

Effective ways to boost a credit score

1. Deletion of negatives 

2. Clear your debts

3. A maximum of 10% credit utilization

4. Maximum of 3-4 credit cards more than that causes more harm

5. Dispute any errors or items in your credit report

6. If you ever get confuse contact an expert but be very careful

7. Use a reputable credit repair company

This should help you http://creditstreamers.com/info/

I started building my score a few months ago and currently have a FICO score of 785

These are some steps to get faster results:

1.  Find out when your issuer reports payment history There’s something called a “credit utilization ratio.” This is the amount of credit you’ve used compared to the amount of credit you have available. You have a ratio for your overall credit card use as well as for each credit card. It’s best to have a ratio — overall and on individual cards — of less than 30%. But here’s an insider tip: To boost your score even quicker, keep your credit utilization ratio under 10%).

2. Pay your debts strategicallySince the FICO score also looks at each card ratio, you can bump up your score by paying down the card with the higher balance. This helps your credit score).

3. Pay twice a month: ( You know that call you made to get the payment history? Make a payment two weeks before the closing date and then make another payment just before the closing date. This, of course, assumes you have the money to pay off your big expense by the end of the month. This also helps your credit score).

4. Raise your credit limits Now, if you tend to have problems with overspending, don’t try this. The goal is to raise your credit limit on one or more cards so that your utilization ratio goes down. But, again, this only works out in your favor if you don’t feel compelled to use the newly available credit.

5. Bottom line: ( When you want to boost your credit score, there are two basic rules you have to follow:

First, keep your credit card balances low.

Second, pay your bills on time (and in full). Do these two things and then toss in one or more of the sneaky ways above to give your score a kick start.

And remember — you do not have to carry a balance to build a good score. If you do that, you’re on a slippery slope to debt.

6. Best of all You could hire a professional to boost your credit, while you watch it rise. I recommend

http://repairbase.ga

 

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