Your credit score is a grade that indicates how well you manage any loans given to you. The higher the score, the better, but if your score is not as high as you would like, don’t despair, as there are things you can do to boost it. Read on to find out what they are.
Always hit your payment deadlines
One of the smartest ways you can improve your credit score is to avoid missing your payment dates. What this means is you must hit any payment deadlines for debts outstanding. This is vital because when you miss a payment, it acts as a signal to providers that you can’t keep up with the debt you have. In turn, this will negatively impact your credit report and so make it harder to get credit in the future.
Make sure you check your report regularly
Another important way of increasing your credit score is to make sure that you check your report regularly. Then you will be able to see if there are any issues that need your attention. For example, by checking your credit report, you should be able to see if there are any errors, fraud issues or even old credit accounts that are still affecting it. Once you have identified such issues, you can work with your credit provider to resolve them, and so help to minimise any impact they have on your score.
Challenge credit report errors
Indeed, one particular issue that you should always sort out on your credit report is errors or incorrect information. The reason for this is that such problems can lower your score undeservingly, and make it look like you are a much bigger risk to lenders than you truly are. This can make it very difficult to get loans and could even impact your ability to secure some jobs.
Now, repairing these sorts of errors is not always easy. In fact, sometimes it’s best to recruit the services of a consumer protection lawyer to help you. Especially if they offer their services on a no-fee, no-win basis. In this way, you can not only raise your credit score but also stop the harassment you are receiving for debts.
Choose different types of credit
A good credit score requires evidence that you can manage and properly pay back a range of different types of credit. However, if you have credit accounts for the same category over and over again, this can indicate that there is something unusual about your finances or spending habits. For example, when comparing a credit score holding that has five car loans to their name, to one that has one car loan, a mortgage, and some spending on a catalogue, the latter usually will come out more favorably.
Don’t open too many accounts
Credit companies run a check every time you apply for an account. Unfortunately, too many checks in a short period of time is an indicator that you may be struggling financially and which can lower your credit score. That is why it’s always best to only apply for one or two credit loans at any one time.
Also, even just having lots of different credit cards, particularly if they all have debt on them, can indicate that you are not managing your money very well. That is why it’s best to limit the number of credit accounts you have, as well as do all the other things mentioned above.
