Credit Score Tips: Boost Your Score Before Applying for a Loan

Check Your Credit Report

The first step is knowing where you stand. You can request a free credit report once a year from each of the three major credit bureaus (Experian, Equifax, and TransUnion). Review your report for errors and dispute anything incorrect.

• Look for mistakes: Incorrect account balances or late payments can hurt your score unfairly.
• Dispute errors quickly: Fixing even one major mistake can improve your score fast.

Reduce Your Credit Card Balances

Credit utilization — how much of your available credit you’re using — makes up about 30% of your credit score. The lower your balances, the better your score will be.

• Aim for 30% or less: For example, if your credit limit is $5,000, keep your balance below $1,500.
• Pay more than the minimum: Extra payments help lower your balance faster.

Pay Bills on Time

Payment history is the biggest factor in your credit score. Even one late payment can have a major impact, so make it a priority to pay all bills by their due date.

• Set up automatic payments or calendar reminders.
• Pay at least the minimum amount due if you can’t pay in full.

Avoid Opening New Accounts Right Before Applying

Each new credit application can cause a small dip in your score. If you’re planning to apply for a personal loan soon, avoid opening new credit cards or other accounts until after your loan is approved.

Keep Old Accounts Open

The length of your credit history matters. Even if you don’t use an older account often, keeping it open can help your score by increasing your average account age.

Be Patient and Consistent

Improving your credit score takes time, but every positive step counts. Consistently making on-time payments and lowering debt over a few months can give you a noticeable score boost.