These days, everyone has a credit card and it is super easy to get carried away with it and think that it is free money! If this is you...don't panic! You can improve your credit score easier than you think.
Pay Recent Past-Dues: The first thing to do is to pay the past due payments on the accounts that recently fell a month or two behind. That's because the more recent the late payment, the more it will lower your score.
Request Credit Report Adjustment: After bringing past due accounts current, contact the creditors who report late payments on your credit report and ask them to make a good faith adjustment to remove the late payment information from your credit report files. Not all creditors will do this, but if you ask politely and remind them that you will continue to be a good customer, you may find a few that will work with you.
Pay Collections that Vanish: Pay off accounts where the collection agencies agree to remove all references to the accounts from the credit bureau files. Make this a requirement of your offer to pay off the account.
Spread Debt Evenly: Evenly spread your balances over your cards with the lowest interest rates and the highest credit limits. The objective is to not have more than 50 percent of the credit limit used on any one card. That's because having one credit account nearly maxed out can reduce your credit score. You can also request the creditors to increase your credit limits on your accounts which may help as well.
Check Credit Limit Reporting: Some of your credit accounts may not report the credit limit to the credit bureaus. This reduces your score because when that information is missing, the score counts the account as being maxed out. Ask the creditor to provide this information to the credit bureaus. If they refuse, transfer the account balance to another account that reports credit limits and ask to increase the credit limit.
Keep Good Credit Accounts: Major bank credit cards, held for a long time, with good payment histories help boost your credit score. Also, don't close down your cards that have the longest history and the highest credit limits available because these help boost your score. Instead, close down those department store charge cards. Revolving department store cards have the lowest credit limits and when used will have a higher debt to limit ratio, which detracts from your score.