Boost Credit Score And Lower Premiums! Article

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Boost Credit Score and Lower Premiums!

This article suggests how to improve credit scores through various methods so that consumers will see lower rates for auto insurance when they compare auto insurance quotes.

Author: Norris Rios

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One of the more important factors in car insurance rates is credit score. Insurers think that people with high credit scores are less risky, more responsible, and a better investment. Get more affordable premiums by raising your score. Here's how.

#1: Pay down your credit cards

Most people can't completely pay off their credit cards any time soon, but you can implement strategies to pay off some of the debt and to shift the rest of it around so that your credit score will go up.

Strategy A: Pay off the highest interest cards first
The really high interest cards are the ones that cost you most in the long run since interest payments can financially ruin you by themselves. If you have one card at 25% and another at 15%, you make only your minimum payments on the 15% card and put all your resources into eliminating that 25% one as soon as possible.

This is probably the best long-term financial strategy if you consider debt in a vacuum, but raising your credit score in and of itself gives you several opportunities to become financially strongest, which could give you a better chance of getting out of debt more quickly.

Strategy B: Pay off the cards closest to their limits
This strategy is designed to provide an immediate boost to credit scores. As you get closer and closer to your credit limit on a card, your score drops lower and lower. The idea, then, is to start with a card approaching the limit or at the limit and pay that one down until it is beneath the amount owed on another card.

For example, if one card has a $3000 and you owe $2800, start paying that one before you pay the one that owes $500 on a limit of $2000. Essentially, you are just prioritizing the ones that are close to the limit.
Once you get a card comfortably beneath its limit, then move on to another card.

Keep in mind that even reducing your balance to one-third of your credit limit will increase your credit score significantly.

#2: Continue Using Older Cards

A good credit score is about a well established history. So, the longer you use a card, the higher your score will be. Use your oldest card for purchases and then pay it off before you have to pay interest. Even doing this for $100 a month will add ten or so points onto your score in no time.

#3: Avoid Heavy Spending

Even if you pay it off very quickly, filling up a large chunk of your credit card limit will really hurt your score.

Charge lightly, not heavily.

Credit bureaus look at your monthly spending, so even if you pay it off, they see how high or initial balance is and will hit you right where it hurts: your credit score.

Of course, none of this will save you as much as auto insurance quotes in the short term. However, at length, improving your credit score will really lower your premiums when you use auto insurance quotes.

Get auto insurance quotes today to start saving in the mean time.

About Author

Find Norris Rios's other contributions at http://www.insurersplans.com/articles/extra-credit.html where he gladly shares his opinion on many different subjects and helps people around the globe find a better understanding of the things they're interested in.

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Boost Credit Score and Lower Premiums!