So what’s the answer to those of us who ask: How do I really enhance my credit score today if simply paying on time isn’t the best approach?

Reducing Debt Load

The best means to enhancing your credit score is reducing utilization and a healthy debt-to-income ratio. High utilization indicates a poor debt-to-income ratio and no amount of perfectly timed payments will overcome this element to avoid a tanking credit score or an overwhelming burden on your day-to-day financial life.

Why There’s No Better Savior Than Debt Reduction

While it’s important for you to pay your bills on time (since our FICO score is determined in part by our payment history) focusing solely on making payments on time as an exclusive strategy to boost your score isn’t wise.

Debt reduction is the answer. An unhealthy debt-to-income ratio is essential to a solid credit score and financial health. Too much debt makes it impossible to obtain good lending rates or a balanced monthly budget.

However, simply making payments on a $30k credit card balance is a bit easier said than done. In many cases, credit cards come with high interest rates, making it virtually impossible in some instances to pay off the principal in an acceptable amount of time.

Many of us may think about reaching into our 401k savings to pay off the debt. After all, it would give us an immediate clean slate, right?

This is a drastic and often improper alternative made by individuals and families in trouble. There are often better options and none should be overlooked or disregarded without experienced legal advice on better avenues for debt relief.

Why You Should Consider All Avenues For Debt Reduction And High Credit Scores

There are various proven legal options for debt reduction, including debt settlement and debt relief. And, an experienced debt relief attorney will know the best option under your specific circumstances, including Chapter 7 and Chapter 13 bankruptcy.

In our society, bankruptcy is often regarded as a last resort, a decision that will crush your creditworthiness in perpetuity. But this simply isn’t true.

Paradoxically, your FICO scores may in fact go up post-bankruptcy because of the reduction in your utilization. Credit card offers and car loans are actually available within weeks or months of a bankruptcy discharge and getting approved for a mortgage no longer takes years.

Bankruptcy is an important legal decision that is used by many people, but only with the benefit of experienced legal counsel. In certain circumstances, it is the appropriate method to a lasting financial future within increased credit scores and a healthy reduction in your overall household debt burden-all while preserving your savings and retirement portfolios that took decades of work to build and grow.

In today’s economy, everyone needs to take the time to become educated about their particular financial circumstances with the help of an experienced legal professional.

To learn the best options for you and your family, meet with a specialized debt relief attorney.

The Law Offices of Neil Crane, LLC, is a debt relief agency with 30+ years of experience helping individuals, families, and businesses find lasting solutions to their credit card debt and other loan obligations.