Increasing A FICO Score

Q; My FICO score is 698. Last year, I paid off a debt to the IRS; refinanced my home, which has $300,000 in equity; and I carry less than $5,000 on three credit cards with $70,000 in credit available. What steps are needed to score above 720? I have no late payments and my debt-to-income ratio is respectable.
— Via the Internet,

A: According to industry standards, your credit score is very good. FICO scores range from 300-850, with 720 or more as excellent. To kick your credit score up a few notches, let’s review some tips from

  • Pay your bills on time. Delinquent payments have a negative effect on your credit score — even if they’re not recent.
  • If you have revolving credit, keep the balances low. And, it’s better to pay off debt than to keep transferring balances from one card to the next.
  • Older accounts have more weight than new ones. So, if you’ve recently established credit, give it at least a year to build a positive history.
  • When shopping for new loans, do so within a specified time. In other words, don’t apply for a new loan every other month. This approach will make you look risky.
  • Open new accounts as needed. A good credit mix, such as credit cards and installment loans, is good to have, but too many can lower your score.