Many people do not think much about their credit score until the time comes when they need to borrow money, which could be problematic if you do not h
Many people do not think much about their credit score until the time comes when they need to borrow money, which could be problematic if you do not have a great rating. Getting approved for car finance, buying a home and taking out loans are just a few examples of times that you need credit, and your rating will determine whether or not you can do these things along with what rate you will pay.
Fortunately, there are ways to improve your credit rating and it is a good idea to keep an eye on your score to keep it at a healthy number.
Check Your Report for Errors
First, you should use tools like ClearScore and Credit Karma to check the information on your credit report. You should look out for any errors or fraudulent activity that could be bringing down your score and fix any errors. It is a good idea to check your report annually just to check that everything is correct.
Register for the Electoral Roll
Another easy step to take is simply to register for the electoral roll, which will make it much easier to get credit. You can simply hear to https://www.gov.uk/register-to-vote to do this.
Pay Bills in Full & On Time
One of the most common reasons that people’s credit score drops is that they forget to pay their bills on time and in full. You need to demonstrate that you are a reliable borrower, so start making sure that your bills are always paid on time (you might be able to automate payments).
Take Out a Short Term Loan
Having no credit history will not work in your favour, which is why it could be helpful to take out a short term loan to boost your credit score. Having a loan under your name that you pay back in full and on time will help to show that you can be trusted to borrow money and boost your credit rating.
Keep Credit Utilisation Low
If you are using a high percentage of your available credit each month, it will suggest to lenders that you are not living within your means and this will negatively impact your score. This is why it is a good idea to keep your credit utilisation 25% or lower. Using available credit little but often is smart and will help to build your score over time.
It is sensible to keep an eye on your credit rating as it can take time to improve your score and a low credit rating could create difficulties in many of life’s key moments. It is possible to transform your credit score, though, with the above being a few of the main steps to take.