What is the easiest way to raise your Fico credit score?
Lower your credit card utilization rate, the amount of available credit you use, is responsible for up to 30% of your credit score.
Ask your credit card companies to raise your overall credit limits, if they do, your rate of used available credit will decrease by a percentage. This will lower your utilization rate without paying off any of your existing debt.
Example:
Say you have $100 of debt on an existing credit card that has a $1000 limit. Your utilization rate would be 10%. If you ask your credit card company to raise your limit to say $2000, your utilization rate would drop to 5% with the same $100 of debt.
Now in the long run you should pay off your existing debts as fast as you can to avoid finance charges.
Many people believe using credit cards and paying just above the minimum payment each month will increase their credit scores. This is simply not really true. Paying your statements on time each month and never being late will increase your score, but the utilization rate is what effects the Fico score overall.
