How can I get my credit score up? I have paid almost everything off. Also, if an account is paid in full, why is it considered potentially negative on my report? Can I remove it?
Your Experian credit report will list any accounts that have negative information, such as late payments, under the "potentially negative" section. While Experian doesn't make judgments about the information in your credit report, this list is provided as a service to direct your attention to what lenders are likely to consider negative when reviewing your credit history.
If you have missed payments in the past, those late payments will remain part of your credit history for seven years, even if you have since paid the debt in full. Credit scoring systems look at the history of your accounts as well as the current status. Although the account you mention is now paid in full, any past delinquency could still be considered negative by lenders, so it is shown to you as a "potentially negative" account.
Paying Off Past Due Debt Is the First Step to Improving Credit
Paying off your debts is important, but it is just the first step in improving your credit scores. You also need to show that you are continuing to manage credit very soundly.
The two most important factors in credit scoring are your payment history and your utilization rate, or utilization ratio. Therefore, the most important things anyone can do to rehabilitate their credit are to make all their payments on time going forward and to keep their credit card balances as low as possible.
Scores typically will start improving when you have re-established a current history of on-time payments and low balances with one or more active credit cards. That might take several months or more if you've had serious credit problems in the recent past.
Adding Utility Payments Can Improve Credit Scores
Experian also recently introduced Experian Boost®ø, a free tool that can help you increase your FICO scores instantly by adding your monthly utility and cell phone payments to your credit report. Signing up for Experian Boost is fast, easy, and free.
Adding positive cell phone, natural gas, electricity or other utility or telecom payments can help show that you are a good credit risk, especially if you have a thin credit file or scores below 680. A thin credit file typically has fewer than five credit accounts.
In the past, if you failed to pay your cell phone bill or utilities on time, the late payments could be reported and hurt your credit scores. Adding the positive payments gives you credit for making those payments on time.
You can learn more about Experian Boost on our website.
Thanks for asking.
Jennifer White, Consumer Education Specialist