Credit score is very useful in acquiring loans, credit cards, mortgages, rentals, jobs and insurance. The more credit score you have the better rates and terms that you are capable of being offered. In case you have poor credit score, it is possible to pay hundreds of dollars less if you work to enhance your credit rating.  Here are 5 effective steps to increase your credit score from 1200 to 1500 fast:Here are 5 effective steps to increase your credit score from 1200 to 1500 fast:

1. Check Your Credit Reports

The initial procedure is to obtain credit reports from Experian, Equifax, and TransUnion companies. Go through them with a fine tooth comb for any information that may be outdated, missing or simply wrong. Some of the problems include; accounts which are not yours, wrong balances or status, as well as wrong details such as names or addresses. 

If there are any mistakes written then challenge both the credit bureau and the creditor. Ensure you actually prove that the information was false and can present documents as evidence. The agencies are under the legal requirement of the Fair Credit Reporting Act to investigate within 30 days. Deleting the invalid data could provide you with an instant increase in your scores.

2. Pay Down Balances 

The second most influential determinant of your credit scores is your ability to demonstrate how much you owe when compared to your possible credit limits, or credit utilization. It is advised to keep the debt to revenue ratio below 30%. 

Reduce credit card and other forms of ‘revolving credit’ balances. It can even help if you just move the money around and pay off the balances on as few cards as possible. Reducing installment loans can also raise scores in the near term and lower debt concurrently. It is wise not to shut down idle cards because it will bring down the total amount of credit available.  

Your credit scores should begin to rise as soon as a billing cycle when balances are lowered. Other things that one should also avoid include paying off balances on various credit cards well before applying for new credit as well.   

3. Add Positive Information

New account applications cause the scores to go down in the short-term. But to do this, add more positive information to the structure so that the foundation is strengthened gradually in the course of time. For instance, one could make the decision to become an authorized user on a spouse or a partner’s credit card. They appear on your credit reports as long as they have existed. You do not even need to use the cards.  

You can also approach current creditors and request for higher credit limits. This increases your credit utilization ratios because higher limits with low balances are better. So do not go on to spend more because you find that your credit limit has been increased! Open secured credit cards linked with savings deposits as well also. New account management creates history in the right manner.     

4. Diversify Your Credit Types

The best scores indicate the ability to handle various account types over time and not merely a single snapshot in time. Possessing both revolving (credit cards) and installment accounts (mortgages, auto, student loans) can assist. If you only have credit cards in your credit portfolio at the moment, an installment loan can add variety. But don’t take it to mean that you should open credit cards just to have a variety on your credit reports!

5. Monitor Everything

Monitor your credit standing. To ensure this, you need to get free copies of your reports at least once each year to look for changes if any. Sign up for credit monitoring as well so that you receive notification whenever new accounts are opened. It also helps with monitoring to ensure that any fraudulent or incorrect information is detected immediately, before it affects your scores.

Check credit card and loan statements at least once a month to be sure you are familiar with all the charges made on the accounts. Pay credit bills on time each month and ensure that the outstanding balances remain low in the future. Over a period of time, even if new problems emerge or if there had been some errors committed in the past, they are drowned by the positive information.  

Continue to go through these steps every month. Be patient but persistent. Although it is a marathon, it is possible to boost credit scores significantly over a period of time. It is quite possible to increase credit scores from 1200 to 1500 in the period of 6-12 months if one practices sound credit management principles and techniques. This indicates saved money through the current interest rates that form a bigger amount in the long run!