In life, everyone needs to have a good credit score. Having a good credit score helps you to make bigger purchases such as taking out a mortgage on a
In life, everyone needs to have a good credit score. Having a good credit score helps you to make bigger purchases such as taking out a mortgage on a home, getting a loan for home improvements or getting a car loan. Boosting your credit score is not something that you will be able to do overnight and credit scores will take into consideration years of credit behaviour not just your most reason financial activity as many seem to think! However, there is no need to worry if you have a bad credit score as there are many steps you can take to try and build back up your rating.
Be Aware of Your Credit Card Balances
One of the biggest factors that will determine your credit score is your revolving credit against how much you are actually using. You will ideally want to have this percentage be very low as this will be better for your credit score with 30% or lower the optimum. When boosting your score, you will want to pay down all of your balances and ensure that these are kept very low. What you may now know is that even if you are paying off your balance in full every month, you may still have a higher utilisation ratio than what you think. A good strategy here is to see if your credit card issuer will allow you to make multiple payments throughout the month.
Show That You Can Pay Bills on Time
If you are in the situation where you have a poor credit score, then this can be hard to rectify as chances are most banks will not approve you when you apply for a loan with bad credit. It can definitely feel that you are stuck between a rock and a hard place! A great way to overcome this is to take out a loan from Everyday Loans as they look at more than just more credit score, they also look at your credit future will be like. You can complete their short application form and get a decision within a matter of minutes. Paying back this loan on time will help to build your credit score back up so that when you go to make those bigger purchases, you will have a good enough credit rating to do so.
Leave Old Debt and Good Account on Your Report
When trying to improve your credit score, many people think that having old debt on their report is bad news and as soon as they pay off a home or car the first thing they want to do is have this removed from their credit report. However, this is not the case and it is only negative items that you will want to have removed, plus, it is worth noting that these will be removed from your report after seven years anyway. Your credit score will benefit from good debt that you have paid off as agreed without any trouble.
Keep on Top of Your Calendar
If you are looking to make a big purchase soon such as a car, home or student loan, then you will want to do your rate shopping within a short period of time. Each time you apply for credit this will cause a small dip in your credit score which will normally last one year. Multiple applications for credit are a big no no as this can look like you are desperate and are not in a good financial position.
Ensure Bills Are Paid On0 Time
When planning a big purchase, you may be trying to scramble together as much cash as you possibly can. When juggling bills, make sure that they are always paid on time as this can have a big detrimental effect on your credit score and even stop you from getting a loan even if you have a lot of savings. A good credit score is build from making on-time payments at the same time each and every month. Putting your cash into a savings account for a big purchase is a good idea, but just make sure that you do not forget about paying your regular bills to do this.
Make Sure You Aren’t Taking Any Risks
When you are trying to improve your credit score, it is important that you don’t do anything that is likely to sink it. This may seem like an obvious point, but it is important that you keep this in mind when trying to improve your credit score. Two of the biggest credit score sinkers are missing payments or suddenly paying off less than what you would normally do. We also would not recommend taking any cash advances or using cards at a business that could indicate you are undergoing money stresses such as lawyers. Make sure none of your purchases indicate any risk!