January 24th, 2012 
Category: 
The following is a guest post by moneysupermarket.com.
image src: wikipedia
Have you been paying your credit card balances on time to keep your credit score at a great number? It just might not be enough. Credit scores are based on various factors, some of which don’t seem to make very much sense at first. Here are a few things you can do that sound like they’ll harm your credit score but will actually help you to raise it.
Get Another Credit Card
Part of your credit score is based on the ratio of how much credit you have to how much credit you use. Because of this, adding another credit card or two can help increase your score. When you open new accounts, you boost your overall available credit and lower the percentage of the credit that you’ve used. You can also ask your existing credit cards to raise your limits to achieve the same results. If you have a checkered credit past, consider getting one of the credit cards for bad credit to help increase your score.
Obtain an Instalment Loan
Your credit score is also determined by how many different types of credit you use. You’ll have a better score if you can prove you’re reliable for instalment loans as well as for revolving credit card accounts. Having a car loan, home loan, student loan or a personal loan can quickly improve your score, as long as you make timely payments. If you don’t have any instalment loans in your credit history, think about taking out a small personal loan that you can pay back in a short amount of time.
Don’t Spread Out Credit Inquiries
Each time a potential lender runs your credit data, the inquiry shows up on your credit report and can lower your credit score. Surprisingly, it’s best to apply for competitive loan and credit card offers within a short time period. Credit bureaus don’t distinguish between a single inquiry and several inquiries, as long as all of the requests fall within a 30-day time frame. If you take longer than a month to shop around for the best rates, you risk lowering your credit score.
Don’t Close Unused Credit Card Accounts
Fifteen percent of your score is based on the length of your credit history. One of the things the credit bureaus look at is the average age of your open accounts. This means that older, established accounts help to boost your credit rating. Even if you have a credit card with a zero balance, let the account remain open if you’ve had it for many years, just so it will give you a longer credit history. Bear in mind that closed credit card accounts drop off your credit history after ten years, so you won’t be able to use a closed credit card account further down the road.
This was s a guest post by moneysupermarket.com.
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You were right in saying these things sound like they will harm your credit. The thought of adding another credit card for any reason would make anyone cringe. But when you think of the ratio of available/used your reasoning makes sense.
I agree Y&T, I never thought of it this way. I guess when you really have to improve your credit score, every little thing helps.
I love these tips. I use them all the time. I keep a few cards in my wallet that I use and all the rest go into folders for when I use them every couple of years and I don’t cancel anything unless it has an annual fee.
Good to know these tips are working for you!