We live in a day and age where getting by without credit can be quite difficult. Your credit score is checked for lots of things, from the obvious mortgage and bank account applications to the less obvious car insurance purchases. For this reason alone, this is why it’s important to look after your credit score.
You may have been unfortunate enough to have been hit by a bad credit score and this may be having an impact on you financially. The good news is that a credit score can be worked on and improved over time. In this post I’m going to give you some tips on how you can go about improving your credit score, starting today.
Use a credit card – sensibly!
To get credit, you need to use credit. It sounds crazy but it’s true. The key is to use it responsibly so that you are proving you can manage your money effectively.
The best way to do this is to keep your credit card active and use it for small amounts and pay it off monthly – after you receive your bill. You could perhaps use it for your monthly fuel purchases and then use the money you put by each month for this to pay it off. Little and often is the key!
Don’t use too much credit
To improve your credit score, it’s important to not use too much of your available credit. If you keep your credit utilisation under 30% of your limit, it will prove to lenders that you are capable of managing available credit sensibly. It’s quite simple, if you can’t afford to pay for it all when the bill comes, you shouldn’t really be buying it.
If you do find yourself with the need to take out small loans like those available at cashlady.com, make sure you can afford the monthly repayments. It’s not only your credit score that is at risk if you can’t afford the payments, but your home could also be too.
Check your credit report regularly and amend mistakes
Your personal credit score is produced based on the information that is held on your credit report. This is updated regularly based on your credit activity. If the information held on your report isn’t accurate it can have a negative impact on your score. Make sure you rectify any mistakes which can help boost your score.
Register on the electoral roll
If you aren’t already on the electoral roll then now is the time to do so. By being listed, credit reference agencies can verify who you are and you will appear far more stable to lenders. It will also help if you have lived at the same address for a longer period of time, rather than moving about regularly. You can register for the electoral roll here. This will go a long way to improving your credit score, so it’s well worth doing.
Avoid multiple credit applications
When you make a credit application a search is carried out on you and this gets marked on your report. If you apply for credit on several occasions in a short space of time, it can make you appear desperate for credit, and in lenders eyes, this doesn’t look good.
If you are unsure if you are likely to be accepted for credit, take a look at the next step…
Use eligibility checkers
These days there are eligibility checkers available that do a ‘soft search’ on your account before you apply properly ( this is when a ‘hard search’ is done). Soft searches do not appear on your account for lenders to see – only for you.
Eligibility checkers are a great way to see if you are likely to be accepted before you apply, so you can avoid putting in an application for something you might not get. This will result in fewer refusals on your report.
Avoid late payments
Sometimes it’s unavoidable and sometimes life gets in the way and we genuinely forget, but it’s very important to pay your bills on time.
Late bill payments can have a negative impact on your credit score because it suggests that you can’t manage credit very well. The best way to avoid this is to use direct debits to pay things like gas, electricity and mobile phone bills. Your credit score will take care of itself when your bank are doing the hard work for you. Just make sure you have the money in there to cover it.
Hopefully, these tips will have you well on your way to improving your credit score. Financially difficulty affects a lot of people but it doesn’t have to impact on your entire life. Just as with anything, it can be repaired, and if you know how to do it, you’re halfway there.
Did you like this post? Why not Pin it?
Written in collaboration
No Comments