How Can I Raise My Credit Score in 30 Days

Michael Collins
Nov 30, 2020

Imagine this: you need a loan quickly, but you know that your lender will check your credit score. You also know that if you have a low score, you can end up paying more for your loan due to a higher interest rate, or you might even get turned away altogether. Over the past few years, you have opened tons of new credit cards, have not had a perfect record of making payments on time, and increased your credit card debt.. For a while, you did not even know what a good credit score was and the importance of it! As a result, your credit score is poor. However, you really need this loan, and you don’t want to be rejected so you think to yourself, “how can I raise my credit score in 30 days?”

Thankfully, your friends here at Possible are credit wizards. Aside from helping you improve your personal credit score through our credit builder loans, we know how credit works overall and how you can improve it. If you need a loan, such as a personal loan,  within the next month or so, you can raise your credit score by doing things like paying off your current debt, making sure your lender is reporting your successful payments, and disputing errors on your credit account. Let’s take a look at some of the ways to quickly raise your credit score in detail so you can be on your way to boosting your score. 

What is a Credit Score

Before we go any further, let’s make sure you know exactly what a credit score is. While there are other types of credit scores, the main credit score that almost every single lender uses is called the Fico credit score. Your Fico credit score is a three-digit number that ranges from 300 to 850, with 850 being the highest credit score you can achieve. 

This three-digit number represents your “creditworthiness” as a borrower, or how well you can pay back your debt or lines of credit. This score is created by credit bureaus like Experian, TransUnion, and Equifax by compiling information they receive from your previous lenders. For example, if you continually make your payments in full and on time, your lenders will report your good borrowing behavior and your score will go up. 

Your credit score is basically a way for lenders to look at how well you can be trusted. Many lenders will quickly look at your credit score to determine whether they should lend you money or not. They may also perform an analysis called credit scoring to take a deeper dive into your credit by looking at your credit report and credit tradelines.

What Makes Up My Credit Score?

It’s important to know what goes into your score so you can learn how to improve it. The five components of your credit score are payment history, credit utilization, length of credit history, credit mix, and new credit. Let’s take a look at what each of these mean and how important they are to your score. 

  • Payment History (35%):  Your monthly payment history has the biggest weight on your credit score. Your payment history is simply the record of your past payments from any loan account or line of credit from the past 7 to 10 years. Above all, lenders want to see concrete evidence of whether you can be trusted to pay back your debts. Any payment that’s been reported by your lender will be factored into here. 
  • Credit Utilization Rate (30%): Credit utilization is how much of your credit line you use a month. Your credit utilization ratio is the percentage of this credit usage. If you are given $1,000 a month to use with your credit card and use $800, your credit utilization ratio is 80%. Lenders and credit bureaus want to see your credit utilization ratio be at 30% of your available credit per month or below. Using any more credit than this can actually hurt your score. 
  • Length of Credit History (15%): The longer you have had your credit accounts the better. If you’ve successfully been making payments for 10 years, your length of credit history looks much better to a lender than someone who has only had credit for 1 year. Any credit history that is 7 years or more is good for your score. Consistency is key for lenders!
  • Credit Mix (10%): Your credit mix is made up of the different types of debt that you have taken on. Lenders want to see this mix be as diverse as possible. For example, if your credit mix only consists of credit cards, an auto loan lender might see this as a red flag, since you have not had any experience with any type of loan. 
  • New Credit (10%): Any recent loan or credit accounts you’ve opened will impact your credit score. It’s better for your credit score if you don’t have many recent accounts opened. Remember that every time you seek new credit though, you get an inquiry on your credit score. A hard inquiry is an inquiry you get when seeking new loans or lines of your credit. These can lower your score anywhere from 5-10 points, so make sure you have less than 5 in any 6 month span. 

You now know what your credit score is and what goes into it, so let’s now look at how you can quickly improve it!

Get Your Free Credit Report and Credit Score

Before you make any moves to improve your credit, it is essential you know what your current Fico score is and what is affecting it. You can do this by requesting your credit report and credit score from the three credit bureaus. Each bureau will allow you to check your Fico score once a year for free. By checking with a different credit bureau or credit reporting agency each time, you can have 3 free credit reports and credit score checks a year. It is important to use all three each year so you can always be in the know of your current credit standing. 

By checking your credit score, you can know exactly what you are working with and how much further you will need to go to have better credit. If your Fico score is somewhere in the 500-600 range, you know that decent credit is within reach. If your score is below that, you know that you have bad credit and much more work to do to get good credit. 

Similarly, by checking your credit report you can see what exactly might be affecting your credit score. Say every account you have opened is either closed or has no remaining balance except one account that has multiple pending payments and a high balance. You can pretty well determine that this account is what is bringing your score down and that you need to address it quickly. 

Pay off your Current Debt

Having outstanding debt on your accounts is not good for your credit score. Think about it; lenders will be less willing to lend money if they request a credit inquiry and see that you already have other debt you need to pay off and you have a history of missed payments. They will not be convinced that you will be committed to paying back their money and they will be less willing to lend you money. This applies to both your loan balances and your credit cards. Having copious amounts of outstanding debt and credit balances is both bad for you and bad for your credit score. 

Make an effort to pay off your debt and credit card as quickly as possible. Focus on making payments to accounts with smaller balances so you can pay them off faster. Paying off two smaller accounts completely is better for you than lowering your balance on just one account. If you have multiple outstanding loan balances, consider consolidating your loans into one loan that can be easier to focus on making a payment to. 

Tip: Don’t Close your Accounts Just Yet

It can feel great to pay off your balances on your accounts completely. It can feel even better to close that account so it does not have to loom over your head anymore. However, you should not close your accounts right before applying for a loan, as having fewer accounts can lower your credit score. Keep those accounts open until after you apply for your loan so your score does not take a hit at the worst possible time. 

Increase your Credit Limit 

Increasing your credit limit on your credit card and other lines of credit is a great way to increase your credit score. Recall that your credit utilization makes up almost a third of your credit score. This is a huge chunk of your Fico score, and improving this can boost your credit score. 

Earlier we had mentioned that your credit utilization ratio is what is most important about your credit utilization. Again, your credit utilization ratio is how much of your credit you are using on your account. For example, if you have a credit limit of $1,000 on your credit card and use $500, your credit utilization ratio is 50%. Remember that lenders want to see you have no more than a 30% credit utilization ratio. Anything at or lower than 30% can increase your credit score. 

While just spending less on your credit card can improve this ratio, that might not be an option for you. Instead, you can ask your provider to increase your credit limit. If your limit is currently $1,000 and you are using $500 each month, your ratio is 50%. However, if you raise your credit limit to $1,500 and still spend $500, your credit utilization ratio is now 30%. Neat, right? You can lower your utilization ratio and still spend the same amount and increase your credit score as a result of it. 

While some credit card providers might offer this credit limit increase to you, you may need to ask other providers to do this. If you have successfully been paying off your credit card balances, your provider will be more willing to give you this credit limit increase. 

Contact your Lender 

Did you know that lenders aren’t required to report your payments to the credit bureaus? While lenders are not required to report late payments and successful payments, most of the time they do. Unfortunately, there is more incentive for a lender to report a failed payment than a successful one. By reporting late payments, lenders incentivize borrowers to make payments or else their credit score will go down as a result of the failed payment. 

Because there is more incentive to report a late payment than a good one, your lender may not be reporting your successful payments. You could be the best borrower in the world, but as long as your lender isn’t reporting your payments your score will not go up. 

Again, check your credit report to see if your payments are being reported. If they are not, contact your lender. Kindly ask that they report your successful payments. While they are not obligated to, many lenders will be happy to report your payments; they might just need a little push. 

Likewise, lenders might be reporting negative balances and outstanding debt despite you having paid the balances off. Again, give your lender a call and make sure they are reporting the correct information. 

Dispute Inaccuracies 

Credit bureaus and lending institutions are run by a bunch of humans, who like you and me, are not perfect. As such, there may be some mistakes on your credit report that could be causing your score to go down. Credit bureaus allow you to dispute any inaccuracies you may find on your account. 

Check your credit report and finely comb for any mistakes that might be made. If you find one, dispute the inaccurate information. While this may be painstaking, if you put in the time and effort and successfully find and dispute inaccuracies, you could see your credit score get the boost it needs. 

Credit Builder Loan with Possible

At Possible, we offer an awesome product that can help you increase your credit. We are extremely excited about how it has been helping our current customers, so we want to make sure to share it with you as well. We call it the “credit builder loan.”

With our credit builder loan, we give you an amount of money under $500 that is to be paid back in 4 weekly installments, or a payment every week for a month. We report your successful payments to the credit bureaus. This means that by paying back our small and quick loans, your credit will increase in just a short amount of time. 

We understand that building credit is hard, especially if you have poor credit. Because of this, we offer our loans to people with low credit scores. Unlike other lenders, we want to build value for our customers. We don’t want to see you struggle with payments and get caught in the cycle of a payday trap. We offer competitively low APR and even allow you to extend your payments up to 29 days if you are struggling to make a payment. This additional help is something that most lenders do not provide, and it can be the difference between missing a payment and making a payment that can boost your score.

Whether you are in need of a small loan or simply want to build your credit, Possible’s credit building loan is a great way to achieve that. Convinced? Download our app today and get started.

Michael Collins

Michael has a passion for writing and brought that passion to Possible. He enjoys reading everything there is to know about film, sports, and finance. His studies in college have allowed him to be on the forefront of business knowledge so he can better inform his readers.

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