A while back I wrote a blog about credit score boosting strategies vs. credit repair. I think this article will answer all your questions and more!
The Credit Restoration Expert will reveal how your client's can get a 40-60 credit score boost in 45 days. First off, there is credit repair and there is boosting a credit score. If your client has a poor credit rating because of mulitple late pays and other "negative" items on their credit reports this is appropriate for credit repair and they should visit
For other clients who may have a drag on their credit score here is a technique to boost their score. Check the limit on their credit cards to see if they are carrying too much balance. For example if the credit limit is $9k, then the client would not want to carry more than $3k long term, even for a couple months because it will drag their score down. Two options, option number one is pay down the balance to approximately 30% of the credit limit allowance. Option two, call the credit card company and see if the client can get a higher credit limit. Either of these strategies would provide a boost to the credit score.
Is it better to have 10 credit cards with small balances or 3 credit cards maxed out but paid on time?
Good question, I am so glad that you asked. In a perfect credit world a client would have all three types of credit, secured such as a mortgage, unsecured such as credit cards and installment such as a car loan.
If the choice was to have three credit cards maxed out vs. ten credit cards with small balances from a credit stand point then the 10 credit cards so long as they are not carried with a balance of 30%.
If a client starts to close down some of these cards there will be changes to their credit score and not always good changes. Therefore, if your client just needs a boost! Educate them to pay down their credit cards to 30% of their limit, and until they purchase a new home don't finance any new purchases such as a new car. I always tell people, wait until you have a new home so that you can park your new car in the driveway after you close escrow of course!