A credit score is important, especially when looking to secure a loan at a favorable rate, or one in the first place. But how do you improve or ensure you have a good credit score? Here are some tips for checking credit score:
- Review Your Credit Report
Everyone in the country is entitled to a free credit report per year from one of the 3 primary credit reporting bureaus. Take a close look at your report and dispute any errors you come across. This is, in fact, the fastest way to fix your credit score. Notifying the credit reporting companies of outdated or wrong information will instantly improve your credit score the moment the errors are fixed. However, keep in mind that requesting a credit report more than once can affect your credit score negatively.
- Contact Your Creditors
If you miss payment deadlines and cannot afford to make the payments, you’ll want to get in touch with your creditors rather than ignore them. Addressing your issues and creating a new payment plan will ease the negative impact on your credit score for paying late.
- Have Payment Reminders in Place
We all have a lot going on and it can be easy to forget some payments. An excellent way to ensure you are at the top of your bills is by keeping reminders on your smartphone calendar. Paying your bills on time consistently shows you are disciplined with your finances and improve your credit score.
- Pay More Than Once in a Billing Cycle
If possible, consider paying your bills every two weeks instead of once a month. Doing this reduces your credit utilization and ultimately improves the checking credit score.
- Be Careful When Paying Off Old Debts
When your debt is ‘charged off’, it implies they don’t expect any more payments. So, when you make a payment on a charged off account, it will reactivate the debt and as a consequence, lower the credit score. This is a common occurrence when the collection agencies are in the picture.
- Diversify Your Accounts
Credit cards, student loans, mortgages and car loans account for 10% of your credit score. if you add another element to the mix, you will improve your credit score, given you make the payments on time.
- Pay Down the ‘Maxed Out’ Credit Cards First
If you have several credit cards and one is close to the credit limit, consider paying it off first in order to reduce your credit utilization rate.
- Apply For New Credit Sparingly
Even though applying for new credit boosts your total credit limit, it might end up hurting your credit score if you apply for multiple accounts in a short period. If you need more credit then try same day loans – Loanza is a trust operator.
- Do No Close Unused Credit Card Accounts
A longer history on credit accounts is better and that’s why you should avoid closing unused credit card accounts. If you must, go for the new ones first.
- Go for Debt Consolidation Plan
If you get in a debt consolidation plan, you’ll experience a temporary drop in your score, but as long as you make payments on time, your score will quickly go up, while getting rid of the debt you accrued in the first place.
And there you have it, 10 great and simple tips to boost your credit score either instantly or in a few months time.