With some old high school buddies coming to the age where they start purchasing homes, the topic of credit scores recently came up.

You know you’re getting older when you start talking about mortgage rates and credit scores!

It was actually a pretty fun conversation for me. I didn’t input anything (I got 200K+ in credit from age 21-23…I think I know a little about credit scores!), but just listening was amazing.

Hardly anyone my age has any clue what their credit score does, how it’s calculated, or what it affects. I was amazed. My friends are all college graduates, some with master degrees. Yet, very few even know, let alone understand their credit score.

Now, I won’t even get into Business credit scores, because that’s a whole other ball game (that most small businesses don’t know about either). But personal credit scores….come on guys. Let’s play a game….the friend with the lowest score wins…

I win!

Seriously though. Should I even bother caring about my score at this point? The last time I checked it, it was 471. And that’s before I had filed for bankruptcy. I wonder how much more it can drop…

For the normal post-college grad my age, it’s 3 digits that really matter. For me right now…I think it’s one of the last things I need to worry about. Someday, maybe someday I’ll want to look at my score again, but for now I think I’m OK being a credit score expert…with a terribly low score.

I'm 300K in debt. Gulp. I'm 24 and day traded away a fortune. Now I'm trying to crawl back to zero. Why not subscribe to my RSS feed and join me on this journey. You can also subscribe via e-mail. I appreciate tips and feedback! ~ DebtKid

I would consider myself somewhat of a credit score expert. What I did with my credit score (getting over 100K in credit at age 23) unfortunately didn’t turn out very well for me. That doesn’t mean that you can’t benefit from my mistakes though! Here are 3 free, fast, and easy steps you can take to increase your credit score.

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Here’s a quick tip on how you can raise your credit score very quickly without any cash on hand:

The Tip

Call your current credit card companies. Ask them if they will increase your limit. Even if you owe $1000 on a $1000 limit card, if you’ve been paying on time, there is a good chance they will raise your limit. This provides more “available credit” (debt to limit), a big key to raising your FICO score.

How it works

Let’s do a quick example to show how effective this is:

Let’s say you have three $1000 limit credit cards, each each has a $900 balance.

Card #2: $900/1000 limit. 90% utilization.

Card #2: $900/1000 limit. 90% utilization.

Card #2: $900/1000 limit. 90% utilization.

You give a quick call to each card. Card #1 raises your credit line to $1500, Card #2 to $2000, and Card #3 to $3000. Great!
Now:

Credit Card #1: $900/1500 limit. 60% utilization.

Credit Card #2: $900/2000 limit. 45% utilization.

Credit Card #3: $900/3000 limit. 30% utilization.

Total debt: $2700. Total Limit: $6500. Overall: 42% utilization!

Caution!

Now don’t go and use that extra credit!
*NOTE: When you are talking to the credit card company rep make sure you ask if they can do an increase without doing a “hard pull” on your credit report. A “hard pull” shows up on your report as an inquiry for credit, and can result in a quick 10+ point drop in your score.
Summary

So, in the scenario above. You dropped your credit utilization from 90% (very bad) to 42% (much better, under 30% would be best. Or even 0%!).

What did that cost you? Nothing! Just a few quick calls to your credit card companies. Especially for a younger person with a limited credit history, your credit utilization % is often the only factor you can control. You could easily see a 40+ point jump in your scores by doing the easy, free step outlined above.

Delete bad entries from your credit report (legally!)

If you’re credit has some issues, and you want results a little faster, you might check out a service like Lexington Law.

How To Get Your Score
NOTICE: Don’t get your credit score from anywhere else except myfico.com. They have real scores here, and often handy coupon deals. Currently the top coupon code I could find is: MW01 (looks like 20% off)