How do I Improve?

[Anonymous]

So I finally bit the bullet and paid off two frivilous medical bills that were in collections. One CA immediately agreed to do a PFD. The other, said they would delete the account after 30 days. 

I know I'm not supposed to go by CreditKarma, but CK is showing no derogatory remarks (both of these accounts were listed previously).  However, my score according to CK only increased by 10 pts to 654. My free Discover FICO score is still showing 610 (no change, but it probably has not update yet). 

Either way, these are low scored and I don't know how else to improve my credit and get into the 700s.  My utilization score is pretty bad. CK is showing 49%, but it's actually a lot worse than that. I have no debt other than 3 nearly maxed out credit cards.  But even if I pay these down (or off), I can't see my score jumping into the 700s. Can it?

CK is also giving me a low score (a 'D') for "Total Accounts".  I'm not about to open up any more debt to improve this.  So according to CK my scores are:

Credit Card Utilization - C

Payment History - B (1 missed payment out of 197)

Derogatory Remarks - A

Age of Credit History - A

Total Accounts - D

Credit Inquiries - B

Is there any other way to improve my score?  I used to be in the 700s. I had some struggles and my mortgage almost went into forclosure about 12 years ago (it has since been paid off and this account is not showing at all on CK).  I'd appreciate any advice.  

Thanks

[Anonymous]

Keep in mind that score wont increase over night and there is no quick fix.   First I would clean up your report first, make sure there is no collection or charge off, if there is then paid them off and try to get them delete from your file.  Second, MAXED out your credit card is very bad thing most people makes mistake. NEVER maxed out your CC, that will show the lender you are high risk. I recommending pay those credit card down to 1-9% and have it report 1-9% each month. Third, have a mixed credit report. If you have not yet have installment loan, get 1 or couple. Installment mean like auto loan or secured/unsecured loan from your bank. Having a mixed credit is good and pay them on time each month with low balance report.  BUT your most important thing is youre revolving which is  your credit card, its affect 35% of your score pay them off or leave low balance.

[Anonymous]

Thanks. 35% of overall score IS significant, so getting my utilization down will be my next step. 

I'm a little confused what you mean by mixed credit though. I recently just got done paying off an auto loan. Not sure if you're suggesting that I always have some sort of current intallment loan that I'm paying? I've had what I would think are a normal number of mortgages and installment loans in the past. I see no reason why I should be getting such a low score on number of accounts. But maybe you're right and it's because I have ALL credit cards now and just one type of debt.

Thanks,

[Anonymous]

Paying your balances down to <10% will get you an immediate score bump. How much of a bump is impossible to say, but its the quickest way. You could also get a small secured loan from a CU to add to your credit mix. Secured because that will get you the lowest interest - typically 3-6%. I would suggest SDFCU, as they are very easy to work with online.

While most of your score is revolving accounts, FICO likes to see a mix of different typs of credit, revolving, installment, and mortgage.