How can I improve my credit score to 700 quickly?

[Anonymous]

Currently my score is 650/650/660. I got about similar scores about 1 year ago and haven't missed any payments since then. I'm confused that I don't see any improvements and i'm seeking advice here.

From what I understand, a lot of it has to do with my two late payments about 3.5 years ago. I wasn't very careful at all then and simploy forgot to pay. But I did pay the full amount they asked for at the earliest possible time when I realized it. Subsequently I closed one of the cards and kept the other (BOA). Also, I've always had a good amount of money in BOA's savings account (not sure if it helps at all). Would it be possible to ask BOA to delete the late payment record?

As of now, I have one other credit card and my two cards total ~$10,000 credit limit. Normally I would have ~$4,000 monthly expense but I could use debit cards/cash if it helps my credit score. I don't have any loan or mortgage. And I have about 4 inquiries in the past 12 months.

I'm upset that my credit score didn't improve much in the past year and I really want to see it reach 700 asap. What would be your suggestions? Thank you!

[Anonymous]

In general you should have 3-5 revolving accounts. At least one installment loan. One mortgage. 5-10 years of account age. No 30 day lates in the last 24 months. No collections or public records - though I have heard of people with 700 scores 24 months out from BK.

A great deal of your score is your revolving accounts. Keep total utilization on them below 10% - Utilization meaning reported balance, not total amount charged in a cycle. For example, you can charge it up near max several times each cycle and pay it back down. as long as the balance is below 10% a week or so before the statement cuts you are fine. Most people here recommend paying off all but one card and keeping that card below 10% UTI. 

[Anonymous]

The general rule of thumb is keeping your card under 30% but, the lower you keep your utlization the better.

You should make sure all your cards are paid in full every month except 1 before the staement report date.. You don't want carry a balance on both.

If you do go above the 30%, you can always recover your score by paying the card down.

[Anonymous]

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@Anonymous wrote:

"From what I understand, a lot of it has to do with my two late payments about 3.5 years ago...Would it be possible to ask BOA to delete the late payment record?"

Yes, two ways to go about it:  You could write them a Goodwill (GW) letter asking them nicely to remove it (search Goodwill on this site) or you could go the DIY credit repair route and start sending them certified letters.  If you follow all the steps and they don't respond to a letter within 30 days, you can have it removed.

"As of now, I have one other credit card and my two cards total ~$10,000 credit limit. Normally I would have ~$4,000 monthly expense but I could use debit cards/cash if it helps my credit score."

Try to keep your balances under 30% of your limits.  So you could either restrict yourself to $3000 in charges monthly, or contact your card issuers and see if they will increase your limits to $12,000+

Also, if you can afford to, pay off you balances as soon as the statement posts instead of waiting until your due date.  This will help improve your credit utilization ratios.

 "I don't have any loan or mortgage."

If you don't have any installment loans, I would open one.  Installment loans report differently than revolving credit.  If you don't need a car, house, computer, or furniture anytime soon, then you could open a secured or "credit builder" loan.  Many banks and credit unions will allow you to put money in a CD or savings account and then lend you money against those secured funds for a few points more.  If you can afford to set aside $1000 or $2000 for a year, I'd start with a 12 month secured loan and set it up on auto-pay so you don't miss any payments.

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[Anonymous]

"For example, you can charge it up near max several times each cycle and pay it back down. as long as the balance is below 10% a week or so before the statement cuts you are fine. Most people here recommend paying off all but one card and keeping that card below 10% UTI. "

So if my credit card cycle ends on the 30th of every month (call it month 1) and due on the 30th of the following month (call it month 2), you are suggesting that I pay off the balance on the 29th of month 1? Would it be most optimal if I pay off everything but $1 on the 29th of month 1 and pay the remaining dollar on the 1st of month 2? That's acceptable if it helps my score. Let me know if i understood it right. Thanks!

[Anonymous]

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@Anonymous wrote:

"For example, you can charge it up near max several times each cycle and pay it back down. as long as the balance is below 10% a week or so before the statement cuts you are fine. Most people here recommend paying off all but one card and keeping that card below 10% UTI. "

So if my credit card cycle ends on the 30th of every month (call it month 1) and due on the 30th of the following month (call it month 2), you are suggesting that I pay off the balance on the 29th of month 1? Would it be most optimal if I pay off everything but $1 on the 29th of month 1 and pay the remaining dollar on the 1st of month 2? That's acceptable if it helps my score. Let me know if i understood it right. Thanks!

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Basically, thats the idea. But I would go in 3-5 days before the statement is cut and pay all but a few dollars. The idea is to leave a small balance so it does not look like the card isn't being used at all. You can contact them and find out exactly what day the statement is cut and when they report balances to the CRA's. It may or may not coincide exactly with the 'due date'.

I go online several times during the month and make payments sometimes as often as three times a month. Don't rely on sending a check in the mail.