4 ways to improve your credit score in under 30 days

A higher credit score will open doors to better interest rates, more favourable terms on auto loans or personal loans, and higher credit limits on new or existing credit accounts.

1. Pay off credit card debt

Your credit utilisation ratio is a major factor used to determine your credit score. Simply put, this is how much of your available credit card balance you’re using.

To calculate your credit utilisation ratio, you can divide your credit card debt by your total credit limits. If you have two credit cards, each with a Dh2,000 limit, your total credit limit is Dh4,000.

If you owe Dh500 on one card and Dh750 on the other, your total debt is Dh1,250. In this case, your credit utilisation ratio would be 62.5 per cent (1,250/4,000 = .625), which is considered high.

The lower your credit utilisation ratio, the higher your credit score. Experts suggest keeping your ratio below 30 per cent. A high credit utilisation ratio, especially over 50 per cent, will lower your credit score.

Why It Works

Credit card companies report your credit balance and credit limit to the credit bureau each month. This often happens on the same day that you’re issued your monthly statement.

“As the credit bureau gets new information, they use it to calculate and update your credit score,” said Abu Dhabi-based independent debt consultant Rajesh Markara.

“Since the credit bureaus calculate your credit utilisation ratio monthly, simply paying down or paying off your credit card debt is one of the fastest ways to improve your credit score.”

2. Ask for a credit limit increase

This is another way to lower your credit utilisation ratio and increase your credit score in under 30 days.

“If your budget is tight and you can’t make extra payments to pay down your credit card debt, try asking for a credit limit increase from your credit card issuer instead,” added Markara.

“If you increase your credit limit but not your spending, you'll be using a lower percentage of your credit balance.”

For example, say you have a credit card with a limit of Dh4,000 and your current balance is Dh2,000. That means your credit utilisation ratio is 50 per cent, which is high.

If your credit card company agrees to increase your limit to Dh6,000, your credit utilisation ratio would drop from 50 per cent to 33 per cent, which is a lot better and likely to boost your credit score.

Why proceed with caution

“Lenders usually check your credit history before extending new credit. This includes credit limit increases,” explained Rupesh Naish, a credit and debt consultant based in Dubai..

“Before requesting a credit limit increase, you’ll want to figure out if your lender will do a hard inquiry or a soft inquiry on your credit report.”

(Hard inquiries are when you've given permission to check your credit report, which can lower your score. Soft credit inquiries don't harm your credit score but do involve someone checking your score.)

If requesting a higher credit limit only requires a soft inquiry from your lender, then there isn’t really any harm in asking. But if your lender will do a hard inquiry, you should stop to consider the pros and cons.

To sum up, if you can’t make extra payments on your credit card debt and you won’t be tempted to spend more, getting a credit limit increase is a good move to lower your credit utilisation ratio.

3. Become an authorised user

A third way to raise your credit score in under 30 days is by becoming an authorised user.

“If you know anyone that has excellent credit, and they’re willing to help you out, ask if they’ll add you as an authorised user on one of their credit card accounts,” said Markara.

As an authorised user, you can use the credit account but you’re not legally or financially responsible for the credit card debt or monthly payments.

“The timely payments, length of credit history, and low credit utilisation ratio of that credit card account you use will be reflected in your credit reports and help you build your credit,” Markara added.

Being an authorised user also allows you to budget and manage money in small steps before you open your own lines of credit.

“But it can backfire and negatively impact your credit score if the primary account holder has several late or missed payments or has a high credit utilisation rate on their account,” cautioned Markara.

Because this can then decrease your credit score and defeat the purpose of being added as an authorised user. That said, you can ask to be removed as an authorised user, whenever needed.

4. Dispute inaccurate data on your credit reports

Last but not least, you can improve your credit score in 30 days by disputing inaccurate entries or information on your credit reports.

“Once you have your credit reports handy, review them thoroughly. Look for inaccurate, incorrect, or duplicate information on your credit history,” Naish added.

“For example, if you always make on-time payments but your payment history includes several late payments, you should dispute that and get that corrected.”

Other times, you might see an account on your credit report that you never applied for or opened. This could be the result of identity theft or a lender’s reporting error.

It can take some time — often several billing cycles — to successfully dispute and remove inaccurate negative information from your credit reports.

Creditors and credit reporting bureaus have 30 to 45 days to investigate a dispute letter and five days to respond after that’s complete.