Personal Finance

3 Simple Steps to Significantly Raise Your Credit Score Within 12 Months

6 Articles Written

My credit score sucks! How can I get a real estate agent to talk to me?

Want more articles like this?

Create an account today to get BiggerPocket's best blog articles delivered to your inbox

Sign up for free

We operate in a fast paced world. It’s filled with individuals who can suck time like a vampire feasts on blood. For this reason, some agents have developed the habit of not even taking the time to speak with someone who has a poor credit score. Have you fallen victim to this?

It’s a scary fact that some individuals have a poor credit score because of poor financial habits, and they have no desire to change. These are the people who make it hard for all the others who want to change — the people who want to clean up their credit, pay their bills, and overcome the circumstances that demolished their credit score.

I am a real estate agent that believes there are more people striving to be better, wanting that 720 credit score, they just do not know how to get it, as opposed to the belief that those with a low credit score are a waste of time.

For those individuals who are really committed to getting that 700+, I am going to share some simple tips that will put you on the path of credit recovery. While you read, keep in mind the tips are not the important thing to focus on here. The commitment to these actions and the drive to seek more knowledge are most important.

This is step one after major life events — or just plain bad choices — that have demolished your credit score. Make sure the “bleeding” has stopped before you attempt any credit repair activities.

Commit right now, and 12 months from now, you will have the credit score that will make any real estate agent drop to their knees for your business because your new credit score is gold.


Related: How to Improve Your Credit Score

3 Simple Steps to Significantly Raise Your Credit Score Within 12 Months

Pay your bills on time.

The credit score is a measure of how likely you are to miss a payment or default on a loan in the next two years.

It can’t get more simple. Pay your bills on time.

Pay. Your. Bills. On. Time.

Paying your accounts on time every month accounts for around 35% of your score. Set up those auto-payments to keep you on track in case you forget.

Keep the balances down.

Your credit balances are responsible for another 30% of your credit score. Most credit “experts” will suggest you keep your credit balances around 30% of the max credit limit for any one account. For an optimal credit score, I suggest keeping it around 10%.

I have tracked my credit score daily for almost two years, and I have found there is around a 30-40 point drop when going from a 10% balance to 30%

Related: Why Boosting Your Credit Score to “Excellent” Can Make You a Better Investor

Add new credit.

Over the last two years, I have learned a lot on the subject of credit repair, and I have used my knowledge to help my friends around me. One of the most common things I see is people being fearful after going through a rough patch. They even go so far as to blame their troubles on the credit card companies! Then they make a commitment to never use credit cards again, often using the line “credit cards are evil.” How crazy is this! It is hard for them to accept the fact that new positive reporting trade lines are needed to boost the credit score.

If this sounds like you, remember, it’s a new day, and you are a new person. Do not be scared of getting new credit cards. For a person with a low credit score who may not be able to qualify for a traditional credit card, I always suggest secured credit cards that graduate to unsecured after a specified amount of time. These will provide positive credit reporting that a person with a low credit score desperately needs. These will push the credit score upward as you take the time to repair the negative items on your report.

I always try to keep my writing short and to the point. These three tips will put you back on the road to credit score recovery, leaving the days of being ashamed when a lender runs a credit check in the distant past, like a bad memory.

Credit repair cannot be covered in a few hundred words, so if you are interested in boosting credit score, make sure to keep an eye out for my articles. I will be covering the entire credit repair process in short, easy to consume articles.

What are you doing to raise your credit score?

Leave your questions and comments below.

Brandon is a U.S. Army veteran, serial entrepreneur, and real estate investor who helps others improve their life through writing for online publications such as "Bigger Pockets" and "The Good Men ...
Read more
    Paul Osyer
    Replied over 4 years ago
    Paul Oster As a certified FICO Pro, I would love to contribute on an articles written about credit.
    Bob Mastroianni Wholesaler from West Deptford, New Jersey
    Replied over 4 years ago
    Great Tips! I find that many people know the “Range” of their credit score, but have no clue where the number comes from or how to make it better. There are some good insights in this blog post. Thanks for sharing.
    Brandon L. Real Estate Agent from Falls Church
    Replied over 4 years ago
    Good Morning Bob, and thanks for taking the time to share your thoughts. Hope you have a great day 🙂
    Brandon L. Real Estate Agent from Falls Church
    Replied over 4 years ago
    Hello Paul, feel free to reach out and connect with me. I would love to discuss credit with you.
    Replied about 4 years ago
    I just completed bankruptcy in October 2015 but I have a 739 credit score with Equifax. Am I still considered “risky” for a year after bankruptcy or will banks just look at my score?
    Brandon L. Real Estate Agent from Falls Church
    Replied almost 4 years ago
    Aj, there are many variables lenders will look at, but since I am a real estate agent, I would suggest you reach out to a mortgage professional. I have also written a personal BP blog on the topic. Click the link below to read:
    Jameson Carobert from Hartford, Connecticut
    Replied about 4 years ago
    Great article Brandon! From both a legal and tax perspective, do you find it advantageous, and perhaps necessary, to segregate investment finances from personal finances when borrowing? On that note, would you be able to recommend any particular credit cards to use strictly for real estate/business purposes?
    Brandon L. Real Estate Agent from Falls Church
    Replied almost 4 years ago
    Hey Jameson, every investor has different methods. I would suggest establishing a relationship with a trusted tax advisor in your area. As far as credit cards for real estate, there are a lot of good options out there but I would have to know more about your situation and goals to suggest specific advice. Feel free to connect with me on BP.
    Glenda Nash Contractor from San Diego, California
    Replied about 4 years ago
    I do appreciate this course and I will be following thank you
    Darryl Lee Property Manager from Ellicott City , Maryland
    Replied about 4 years ago
    Great tips! Thanks for sharing.
    Brandon L. Real Estate Agent from Falls Church
    Replied almost 4 years ago
    Thanks Darryl! Hope you have a great day.
    Debbie Yoak from Barberton, Ohio
    Replied about 4 years ago
    Thanks for sharing, i did get 2 pre paid cc a year ago in May and my credit score jumped 57 points over the past year. I now received 2 retail cc just last month. However i may be raising my credit score but no lender will touch me for a home loan since my husband passed away and i lost the house even tho it was not in my name and i was on survivor ship deed. But will continue to raise my credit score in hopes that 1 day i may get financed by myself.
    Brandon L. Real Estate Agent from Falls Church
    Replied almost 4 years ago
    Thanks for sharing your thoughts Debbie! keep chipping away you will get there. Time is our friend 🙂
    Adam McQuiston from Rochester, New York
    Replied almost 4 years ago
    Another great way is to get a secured loan with $1000-$2000 dollars depending on bank. Typically what the bank is doing is, you are purchasing a CD and they are loaning you the money back on the CD. It will cost you less than $25 in interest for the year and you can do it multiple times. Just pay your payments or set up an account with that money and allow it to auto withdraw. Simple and effective.
    Brandon L. Real Estate Agent from Falls Church
    Replied almost 4 years ago
    Good morning Adam, Thanks for sharing the info. Do you mind sharing the banks where you have had success with this strategy?
    emily cole
    Replied over 2 years ago
    Nice article, I used the help of a network engineer who helped me get my score from 506 to 792 within a few days and also clearing all inquiries and late payments from my report.I have never been a fan of hacking but this adventure left a smile on my face.He his so efficient and reliable. [email protected] com
    Lori Jordan
    Replied about 1 month ago
    Excellent article Brandon.