Improve your credit rating

A recent survey from the National Foundation for Credit Counseling indicates that more people would be embarrassed to admit their credit scores than their weight. While crash diets usually don’t work, it’s still possible to change your credit rating fairly quickly.

This year, make sure one financial goal makes it to the top of your list: Improving your credit rating.

Request your credit report. “This should be the very first step,” notes Liz Weston, finance expert and author of Your Credit Score, Your Money & What’s At Stake. “The three major credit reporting bureaus must give you one free copy per year, so plan to order one every four months.” AnnualCreditReport.com makes this fast and easy.

Pay off past-due accounts (and pay your bills on time). Your payment history—including the bills you pay late or skip—makes up a whopping 35% of your FICO score, according to MyFICO experts. If you have several due dates to keep tabs on, sign up for automatic withdrawals to help pay your bills on time.

Negotiate. Looking at your credit report, you may see one or two late payments. Maybe these were late because of an oversight or a one-time financial problem that has since been resolved. In this situation, you might get an automatic boost to your credit rating by writing to creditors asking to “erase” that debt.

“Call or write to the creditor and ask for a courtesy adjustment,” recommends finance expert Abby Hayes of U.S. News: Money. “If you’ve been a good customer and only have one or two late payments, many creditors will remove the late payment from your credit report.”

Lower your credit utilization rate. About 30% of your score is determined by your credit utilization, or the percent of available credit you’re using. The lower your utilization rate, the better your credit score. To calculate your rate, divide your total credit balances by your total credit limits.

“Consumers with a credit utilization rate under 20% generally have a higher credit score than consumers with a credit utilization rate over 20%,” writes Credit Karma’s consumer advocate Bethy Hardeman.

Get a credit card. “Having one or two pieces of plastic will do good things to your score—if you don’t charge too much and pay your bills on time,” notes Curtis Arnold, Forbes Personal Finance contributor.  

Instead of tucking your card in the back of your wallet, make occasional purchases to keep the card active and be sure to pay the account in full.


Northwest offers a choice of credit cards to fit your lifestyle—including the Northwest Rewards and Loyalty cards—with competitive rates and no annual fee. Apply now or or visit your local Northwest office.