Improving your credit score is not the hard work it often seems to be. It just takes a desire to be prudent with your credit. Getting low interest rates for home loans or auto loans, or getting your credit card application approved is hard with bad credit. But if your credit is good, you have more choices.
Verify The Accuracy Of Your Credit Reports
Most credit reports have errors on them. Experts recommend a bi-annual check of your credit reports to check for errors. If you are able to find the mistake fast, the faster you can get the errors sorted out with the people concerned.
The most common error would be a past due or unpaid account when it shouldn't be. Disputing these common errors is relatively easy. If you don't get the errors spotted and fixed on time, this would delay the time they stay on your credit report and thus reduce your credit rating.
Get a copy of your report from Equifax, Experian and Trans Union. This means more chances to ensure greater accuracy. Before you apply for an auto loan or home loan, you will also need to have your credit report reviewed to see if you can afford paying it off.
Be Prompt On Your Payments
Being prompt on your monthly payments is very, very important too. A regular history of late payments can greatly pull down your credit rating. Also, this results in jacked up interest rates and annual percentage rates. Most recommend payment via mail, and recommend doing so 7 to 10 days before the due date. This improves chances of avoiding late payments. There are many alternatives to payment via mail, but one of the safest would be setting up an automatic debit through your bank.
Don't Use All Of Your Credit Limit
A large part of your credit rating depends on how you spend on your credit card. Indeed, the fastest way to jack up your credit score would be to reduce your credit card balance. Minimize the usage of your card to start out. If you can pay cash for an item, do so, and resist the urge to use your card. Use only around 25 percent of your credit limit.
The first part of this battle is to reduce your credit card balance - next step would be to avoid incurring more debts. Try paying for everything that you spend in a month or policing your spending. Once paid in full, many are tempted to cancel their cards. It may look like a smart move at first, but it isn't due to potentially shortened credit history.
Verify The Accuracy Of Your Credit Reports
Most credit reports have errors on them. Experts recommend a bi-annual check of your credit reports to check for errors. If you are able to find the mistake fast, the faster you can get the errors sorted out with the people concerned.
The most common error would be a past due or unpaid account when it shouldn't be. Disputing these common errors is relatively easy. If you don't get the errors spotted and fixed on time, this would delay the time they stay on your credit report and thus reduce your credit rating.
Get a copy of your report from Equifax, Experian and Trans Union. This means more chances to ensure greater accuracy. Before you apply for an auto loan or home loan, you will also need to have your credit report reviewed to see if you can afford paying it off.
Be Prompt On Your Payments
Being prompt on your monthly payments is very, very important too. A regular history of late payments can greatly pull down your credit rating. Also, this results in jacked up interest rates and annual percentage rates. Most recommend payment via mail, and recommend doing so 7 to 10 days before the due date. This improves chances of avoiding late payments. There are many alternatives to payment via mail, but one of the safest would be setting up an automatic debit through your bank.
Don't Use All Of Your Credit Limit
A large part of your credit rating depends on how you spend on your credit card. Indeed, the fastest way to jack up your credit score would be to reduce your credit card balance. Minimize the usage of your card to start out. If you can pay cash for an item, do so, and resist the urge to use your card. Use only around 25 percent of your credit limit.
The first part of this battle is to reduce your credit card balance - next step would be to avoid incurring more debts. Try paying for everything that you spend in a month or policing your spending. Once paid in full, many are tempted to cancel their cards. It may look like a smart move at first, but it isn't due to potentially shortened credit history.
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