One of the best ways to deal with out-of-control debt is to consolidate it by taking out a personal loan that charges a lower interest rate than your credit cards. The problem is, in order to get a personal loan — or any loan for that matter — you have to have a credit score that doesn’t scare off lenders.
Read: 10 Credit Score Myths You Need To Stop Believing
Learn: 19 Ways To Tackle Your Budget and Manage Your Debt
The good news is, there are ways to boost your score right away without actually paying down your debt. From there, you can get the loan you need to start eliminating your high-interest debt once and for all — or take advantage of the many other doors that open when you have good credit. There’s no reason you should pay more for loans, so follow these tips to boost your credit score and help yourself out.
Review Your Credit Report for Mistakes
When it comes to boosting your credit score, the first step is also the simplest. Visit AnnualCreditReport.com, which during the pandemic has been giving out free credit reports from all three credit bureaus — Equifax, TransUnion, and Experian — once per week instead of once per year as required by federal law.
Get Started: Make a Debt-Free Future Your Reality
It’s not uncommon for costly errors to appear on credit reports, but you won’t know if yours contains mistakes unless you check, which should be your first step if you’re looking to improve your score. The FTC offers contact info, procedures, and sample text for people looking to dispute errors they find on their reports.
Participate in Rent Reporting
In 2019, a white paper from the Credit Builders Alliance (CBA) showed the score-building power of a little-known tactic called rent reporting. Not all credit scoring models factor on-time rent payments into their calculations, but all three bureaus will include rental payments in their profiles and reports if they receive it — but that’s a big if.
The CBA paper showed that many people with low credit scores are renters who would stand to benefit the most from getting their history of on-time housing payments in front of lenders. About four out of five people saw their scores improve when landlords reported their rental payments, with the average score increasing by 23 points.
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Some landlords and building managers report rental payments, but many do not. If you choose, you can pay for a service like RentReporters, which claims that their average user gets a 40-point boost in 10 days. Many services like RentReporters also get the bureaus to report your on-time utility payments, which can boost your score just like housing payments.