23 Credit Hacks to Improve Your FICO Credit Score

If you have a bad credit score, don’t despair! Your credit score depends on a few main factors. By understanding which issues affect your score and tackling them right away, you can bring your score up quickly. Here are 23 credit hacks you can use to boost your credit score fast. 

1. Reduce Your Credit Utilization Ratio

Paying off your debt is one of the quickest and easiest ways to raise your credit score fast. Of course, most people don’t have the capital to pay off all their debt at once. Nevertheless, you should pay off as much as possible. 

That’s because a significant factor determining your credit score is your credit utilization ratio – the percentage of your credit line you have used. Your goal should be to keep it below 30% at all times, at the minimum. So, if your credit line is $10,000, you never want to have more than $3,000 in debt.

Of course, the lower your credit utilization ratio is, the better your FICO score will get. Ideally, it should remain under 7%. However, at the very least, try to get it under 30% as soon as possible. So, if your credit line is $10,000, and you owe $5,000, it’s worth paying off $2,000 to reduce your utilization ratio for an instant credit boost. 

2. Set Up Automatic Payments

Late payments can wreak havoc on your credit score. Even a single late payment on your record can make raising your credit score fast tough, so avoid them as much as possible. A great way to ensure you make your payments on time is to set up automatic payments. 

Suppose your bank doesn’t have an automatic payment feature. In that case, set calendar reminders which you can find in many apps. 

The problem with automatic payments is that you may still miss a payment if the bank account you are paying them with doesn’t have enough funds to cover your minimum amount on your due date. For that reason, consider using a savings account to pay your automatic transfers. 

Remember, after six monthly withdrawals from your savings account, you may incur a fee on additional withdrawals. 

3. Ask for a Credit Line Increase

Asking for a credit line increase is one of the most effective credit card hacks to increase your credit score. That’s because it allows you to improve your credit utilization ratio without the risks involved in opening a new line of credit (which I will discuss in the following sections). 

However, there’s a big caveat here. While some banks will perform a soft inquiry before approving your credit line increase, others will perform a hard inquiry. A hard pull can temporarily hurt your credit score. Therefore, it’s worth checking whether your bank does a soft or hard pull for a credit line increase. 

If you own several credit cards from several banks, ask for an increase from a bank that does not perform a hard inquiry. 

4. Open One New Line of Credit

Like asking for a credit line increase, opening a new credit card can help increase your overall credit line. Thus, you can reduce your credit utilization ratio without making any payments. 

Why would you want to open a new credit card instead of asking for a credit increase? Sometimes, you won’t qualify for a credit line increase, or you might only be eligible for a slight increase that won’t affect your credit utilization ratio much.

5. Avoid Opening Too Many New Lines of Credit

This tip might seem to contradict what I just said, so let me explain myself. Opening new lines of credit will trigger hard inquiries into your credit score, which can negatively impact your overall score. Opening a single line of credit to improve your credit utilization ratio can outweigh the negatives. 

Nevertheless, opening up too many new credit cards may do more harm than good. So, if you do open up a new credit card, limit it to one card. 

6. Pay More Than Your Minimum

A common mistake is to only make your minimum payment every month. The problem with this, however, is that if your card charges high interest, it will end up taking a lot longer than you think to resolve your debt. That’s because a large portion of your minimum charge may go towards covering interest fees. 

Most banks will allow you to set up automatic monthly payments of any size, so you don’t have to limit yourself to the minimum amount. 

7. Use the 15/3 Credit Card Hack

Credit hackers often recommend making two payments each month: one 15 days before your due date and another three days before your due date. 

There’s nothing magic about the 15/3 credit hack. Instead, the 15/3 credit card payment hack works because it fulfills many of the principles of keeping a good credit score. 

First, if you don’t have automatic payments set up, it gives you another opportunity to make your minimum payment, even if you forget the first time. In addition, by making two payments a month instead of one, you can keep your utilization ratio low. 

Finally, you can use one payment to cover your minimum balance and another to pay off even more than the minimum at your leisure when you have enough funds to do so. 

8. Dispute Errors on Your Report

Most credit reports are accurate. However, there is a small percentage of statements that contain errors. By disputing a mistake, you can have it removed from your credit report. It’s a great way to cheat your credit score – and it’s entirely safe and legal. 

Go over your credit reports meticulously. If you spot even the slightest blunder, file a dispute! It doesn’t hurt to try. This credit score hack is sometimes called the Credit Karma dispute hack. That’s because you can use Credit Karma to file a dispute with TransUnion. To file disputes with the other credit reporting bureaus, you must go to their websites. 

9. Use Experian Boost

One of the quickest ways to build credit is to use Experian Boost. What it does is add some of the bills you are paying anyway – like Netflix, Hulu, your gas bill, and your internet bill – to your credit statement. 

All you have to do is connect the bills you have been paying on time, and your credit score will update instantly to reflect those on-time payments. According to Experian, users see their credit scores increase by an average of 13 points. If you have been searching Google for how to raise your credit score fast, Experian Boost might be your answer. 

10. Become an Authorized User on a New Card

Are you looking for the best way to boost your credit score fast? Get added as an authorized user on a friend’s, parent’s, or relative’s credit card, so their payments can get reflected on your report. Of course, make sure they have a good credit score and make their payments on time. 

11. Use Credit Karma or Other Calculators

Credit Karma is a fantastic company that will give you insights into the specific factors affecting your credit score. Furthermore, it will provide you with actionable tips you can use to hack your credit score. For example, the Credit Score Simulator will help you figure out how different financial decisions will impact your score. 

TransUnion also has a helpful Credit Score Simulator that can show you exactly how to increase your credit score quickly. Many more are available on Google. 

12. Don’t Close Old Credit Cards

If you have old credit cards that you paid off in full, they may be credit hacks themselves. It might be tempting to do close them, but it’s a trap. The more credit cards you keep open, the larger your overall credit line will be, and the lower your utilization ratio will be. In addition, the longer you can maintain a credit line, the more you can increase your FICO score. 

13. Don’t Start Paying Old Collections

One of the best things about old debts is that most of them fall off your credit report after a certain period. Typically, it takes seven years for a loan to delete itself from your report. That doesn’t mean the loan won’t exist anymore – it just means it won’t impact your credit score. 

If a debt is going to fall off your report soon, it’s better to leave it for now and use your money to pay off newer debts. 

14. Pay Off Your Student Loans First

One type of debt never falls off your credit report: student loans. That is why it is a good idea to prioritize paying off your student loans over other debts. Late payments on student loans will never go away from your credit history. 

15. Write Goodwill Letters to Collectors

Sometimes, you may be able to get a collector to remove a debt from your credit report by writing them a goodwill letter. Of course, this doesn’t always work, but it doesn’t hurt to try. The lender may be willing to withdraw those bad marks from your history in particular circumstances. This process may involve a small fee on your end. 

16. Use a Credit Builder Loan

Credit builder loans are loans that can get your credit score up fast. You will make monthly payments, which will go into a savings account or CD. After you complete all payments, which can take a year or two, you will get access to your money. An ideal app to use is Self, but other options are available, too. 

17. Make Occasional or Recurring Purchases With Old Cards

Remember how I said that you should try to keep old credit cards open as long as possible? If your credit cards aren’t active, your bank may eventually close them due to inactivity. That’s why it’s a good idea to make occasional purchases with all your credit cards so your accounts remain active. 

One good idea is to add one recurring bill to each card. For example, you can use one card to pay for Netflix and another for Amazon Prime. Then, set up automatic payments for each card – and choose to pay off your balance in full each month, so you don’t have to pay interest. 

18. Get a Secured Credit Card

If you have awful credit, opening a secured credit card can be one way to fix it. It’s also a good option if you don’t have any existing credit at all and need to start from scratch. 

There are many secured credit cards available. They require you to put down a deposit to open the card – this deposit may be equal to or less than the full credit line you will get. After a certain period, you will get the deposit back, and you will be able to keep your credit line. Some banks also allow you to request an increase after making consistent on-time payments. 

A secured credit card should be a last resort, however. 

19. Transfer Your Balance to a New Card

Transferring your credit card balances to a single card won’t make your debt disappear. However, it can allow you to make lower interest payments – if the card you are transferring the debt to has a lower interest rate. That can make it easier to pay off your balance in full quickly. 

However, not all cards allow you to do this, and you may have to pay a fee for doing so. Find a transfer balance card that has low fees and interest. 

Similarly, you can consolidate your other debts into one single debt. Again, the point here is to have lower interest rates and fewer payments to worry about, making your debt repayment journey easier. 

20. Use a Retirement Plan Loan to Pay Off Debt

Did you know that you can take out a loan from your 401(k)? Not only that, but it won’t show up on your credit report! It’s one of the easiest ways to get quick money that you can use to pay off your credit card and other debt. 

Keep in mind that you will have to pay back that loan with reduced paychecks, so you won’t enjoy as much income as before.

Furthermore, some companies won’t allow you to make additional deposits to your retirement account until you pay off the loan in full. Some companies don’t let you take out a loan altogether. 

21. Settle Your Debts

Sometimes, you may be able to settle existing debts for a lower amount than what you truly owe. The problem with this method is that your credit report will show that you paid less than what you were supposed to pay. 

However, it is still better than not paying your debt at all. So, if it’s realistically the only way to close a deficit, it’s better than nothing. Furthermore, the fact that you settled the debt won’t stay on your credit report forever – it will drop off after seven years. 

22. Prioritize Paying Off Your Debt Before Saving

It’s essential to have an emergency fund to cover at least a few months of expenses if you lose your job. However, if your FICO score is really low, and you want to improve it as quickly as possible, you might want to prioritize paying off your debts before saving. 

Start with a small emergency fund for unexpected expenses. Then, pay off all your debt until you are debt-free. After that, you can start saving up and investing in stocks again. 

23. Take Out a Mortgage

If you can afford to do so, taking out a mortgage will tremendously impact your credit score. It’s one of the best loans to have on your report. Of course, if your credit score is bad, you might not qualify for a mortgage in the first place. Furthermore, if you are unsure whether you can pay it off on time, it’s not worth it. 

Final Thoughts

Improving your credit score takes time. While there are some things you can do to increase it by several points instantly, you can’t go from 400 to 800 overnight. It takes dedication, commitment, and wise financial decisions to improve your FICO score over several months or years. 

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