mortgage financing and programs

Archive for October, 2010

3 ways for you to improve your own credit

No Comments

The process of self credit repair is a fairly straight forward and simple if you have the right plan to follow.  However if you go unprepared you may run the risk of failing or damaging your credit further.  The following three tips are proven methods that you can use to repair your credit yourself.

Tip #1 – The easiest way to raise your FICO score is to reduce your limit to balance ratios on your credit accounts.  The  magic number is 30%, this means that if you have a $5000 limit you want no more than $1500 on your balance.  Anytime you go over this ratio, your scores will begin to drop.  The fastest way to reduce your balance to limit ratio is either to pay down your balance or call the lender and ask for a credit line increase.

Tip #2 – Another credit repair tip that works is the piggyback method. To do this you need to find a close friend or relative that has great credit and a credit account that has a low balance to limit ratio.  Have them add you as an authorized user and this will help put a positive history onto your credit report.  Just remember that if your friend or family member suddenly starts missing payments,  it can reflect bad on your credit as well.  So be sure that the person you ask to help you with this method will retain a good credit score.

Tip #3 – Probably the best idea and one that still works great is to use a secured credit card.  This will give you some quick positive history on your credit report.  A secured credit works because it reports just like a regular credit card but is much easier to get.  Basically all you need is a job and the ability to repay the card.  To ensure they do not lose money, the lender holds a cash deposit that is equal to your credit limit in an account.  If you default on the account the lender can take the amount you owe from the deposit, but if you cancel the account or get upgraded to a unsecured account the deposit is refundable.

Just remember everyone’s situation is different.  Every tip may not work for every person, but using these tip can help improve your credit drastically, especially if you are in the market for home financing.  If you would like to speak to a Loan Officer regarding your credit for home financing  call 604-916-2321.

Switch to our mobile site