How to Increase a Credit Score With a Bank Loan

Your credit score is a number used to evaluate your credit-worthiness based on your credit history. The national credit reporting agencies TransUnion, Equifax and Experian determine your credit score. Each calculates a score for you independently based on the information in their database about your credit history. The MyFICO website provides information on many ways to increase your credit score, such as reducing your debt on revolving credit accounts and having inaccurate information removed from your credit report. Additionally, if you qualify for a bank loan, you can also increase a credit score with a bank loan.

Instructions

1. Get a secured or unsecured bank loan according to your preference. Both work equally well for this purpose.

2. Confirm that your lender reports account status information to at least one national credit reporting agency regularly.

3. Make the specified loan payments on time. A single late payment can damage your credit rating.

4. Keep the account current for at least one year. The longer you make timely payments, the more your credit rating can improve.

5. Request your free credit report from AnnualCreditReport.com after you have been making payments for three to four months. Confirm that the timely payments you have been making on your bank loan are included in your credit report.

References

• MyFICO information on improving your credit score

Resources

• The official, FTC-authorized website for requsting a free credit report: AnnualCreditReport.com
• Federal Trade Commission (FTC) information on AnnualCreditReport.com