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Nov 21, 2008 12:36 am US/Eastern
Raise Your Credit Score With 2 Simple Steps
SACRAMENTO (CBS) ―
You can raise your credit score in just a few weeks by changing the
way the credit bureaus look at you. Two simple steps - paying down your
balance and using rarely-used cards - can make your score jump by as
much as 60 points in one month, CBS station KOVR-TV reported.
Credit Score Expert Al Bingham helped three KOVR-TV viewers in May raise their credit scores between 16 and 70 points in just one month.
It took a few phone calls; finding some mistakes on their credit reports, paying down some balances, and even opening new accounts.
Then Bingham, who wrote the Road to 850, invited hundreds of KOVR-TV viewers to a seminar in Sacramento.
He shared his secrets and tricks and told people how to change the way the credit bureaus look at them.
Little did any of us know at the time, this country's credit situation would turn toxic and that three digit credit score would mean more than ever.
"If you don't have a high credit score, you're going to limit your ability to move forward," Bingham said.
Bingham says a year or two ago, you could get a subprime loan with a score of a poor 580. Now many lenders want a 680.
"They can't lend to people with risk," said Bingham. "It's no longer a question of which rate can I charge you. It's if I lend to you, will I get my money back?"
When it comes to credit cards, Bingham says the credit bureaus will raise your score if you keep each credit card balance to less than 50% of your limit. In other words, if you have a $5000 credit limit; lower your balance to less than $2500, and you can see a 40 to 60 point jump in your score.
He warns during the credit crisis, many credit card companies are lowering your limits by thousands of dollars; so even if right now you have a credit card balance of less than half your limit, soon you may not.
Remember that 10-year old credit card you haven't used in a while? Go buy a tank of gas on it once every six months.
Just by using it, you'll drive up your score.
Leaving any credit card 10-years or older in the drawer can actually hurt your score.
So what happened after our seminar? --a lot for Janneh Johnson of Sacramento.
"She has torched the system," Bingham said.
"I started making changes the day after the class," Johnson told Kurtis.
She followed Bingham's advice, and after raising her score 119 points in four months. We found her shopping for her first house.
"To get into a house, and actually have multiple bedrooms is a whole new concept for me."
The credit scores for our original three contestants have also continued to go up. One is also close to buying a house after jumping 116 points.
That credit score you have ignored until now, can cost you or save you hundreds, even thousands every month.
"You think it's critical," said Bingham. "It's incredibly critical."
Bingham is holding two additional classes exclusively for CBS13 viewers on Monday, November 24, and Tuesday November 25 at the Marriott in Rancho Cordova. The cost is $10 to help pay for the facilities and printing costs.
Seating is limited, and you have to sign up. You can do so at the top of this page.
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
