How to Create a Perfect Credit Report for Yourself
Generating a perfect credit report for yourself takes a substantial amount of time, even if you already have a good credit rating. People who have any late payments, delinquencies or collection notices on their credit report will have to demonstrate good behavior for at least a decade to gain a near-perfect credit score. The higher that a score becomes, the more difficult it is to raise it and the easier it will be to lose points.
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Instructions
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Borrow money or take on lines of credit only if you have sufficient income to make all payments on time over the period of the loan. Even if you make minimum payments on a credit card every month, running a high balance on a card will hurt your credit rating. Paying off the balance on all credit cards every month will help your score.
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Monitor your credit rating on a monthly basis. Credit report errors are surprisingly common. Dispute any errors that appear on your credit report as soon as possible along with any supporting documentation you might have proving that the entry is incorrect. All three major credit reporting agencies offer subscription credit report services that let you monitor your report either online or by mail.
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Maintain a mixture of long-term secured debt, unsecured debt and lines of credit. According to FICO, this makes up 10 percent of your score, but when you're attempting to get a near-perfect credit score, it can be significant. An example of a good mixture of credit is to have a mortgage, auto loan and a few major credit cards or other forms of unsecured debt.
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Contact any creditor if you may be or have already been late on a payment. If you contact them before a late payment is made, attempt to get an agreement in writing that it will not mark it down as a late payment. If the late payment has already been marked down on your report, you can contact the lender and request that it remove the late payment notice in return for payment. This will be more difficult if you have multiple late payments or delinquencies on your report.
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Avoid applying for too many loans or credit cards. Applying for credit temporarily lowers your score. A pattern of repeatedly applying for loans will have a lasting effect on your credit score.
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Pay all bills on time. Late bill payments do not always appear on a credit score, but if the bill goes into collection, it will affect your score negatively.
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Remain current with credit cards by making small payments even if they are below the minimum required. Making payments as low as $1 per month will keep the account from being charged off. If that happens, it remains on the credit report for seven years and will make it almost impossible to attain perfect credit in a reasonable time frame.
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