Raise Credit Score - 2 Tips

By Matt Douglas

You can improve your credit score by having an open major credit card. On this credit card you should try and keep the monthly balance around 10% of your available credit line.

If you have an available credit line of $2,000 then you want to keep your monthly balance at $200. This will show the credit bureaus two positive things:

1. You use credit.

2. Your ratio of available credit to debt is high.

This means you have available credit that is not being used. The credit bureaus place a large emphasis on your available credit to debt when they calculate your credit score.

Your score will increase just by showing the credit bureaus that you have credit that is not being used. You will receive the most benefit if this is an unsecured revolving line of credit.

Another tip, if your credit is to low to be approved for an unsecured credit card. Then ask a friend or relative with good credit to add you as an authorized user to their credit card account.

This is commonly referred to as piggyback credit. There have been recent reports that the credit bureaus are no longer going to give any credit score benefits to an authorized user.

However because of the size of the credit bureaus and how difficult it is to change credit scoring between all three credit bureaus this change will take time to implement. It is estimated that authorized user's will still receive a benefit for the next 6-8 years.

You will have all the information from this credit card account report on your credit too. If the account goes delinquent it can hurt your score, just like it can help your score. So choose your friend or relative carefully.

It is very easy to be added as an authorized user. The account holder calls the credit card issuer and says they want to add you as an authorized user. It can all be done over the phone.

You then will have a copy of the credit card with your name on it mailed to your house. I recommend returning the credit card to the account holder.

Then all the specifics about the account; payments, balance, limit will be reported on your credit too. This is a great way to show the bureaus that you have made on time payments and have available credit.

It is in the works to discount this method as a way to build credit. However right now it works and it's very cheap and easy.

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