Your credit score dictates your financial life in almost all ways. You get better interest rates and credit card terms with higher scores, and you also get to save money when you have a good credit score. Improving credit scores may take time but is always worth it in the end. Also, the sooner you address your low credit scores, the faster you can improve them.
These steps should help you get a handle on your credit score quickly to qualify for a loan on suitable terms.
1. Use Smart Credit for Interactively Assessing Your Score
Smart Credit is a kind online credit score tracking and modulating platform. You can use it to keep tabs on your credit score and improve it. Smart Credit provides information on the activities that are damaging your score. It also offers a 120-day plan to improve your credit
2. Pay Your Bills on Time
Lenders want to know that you are responsible for your debt. The best way to determine that as per them is to check how proactive and reliable you are with bills. Your payment performance is a great indicator of your future performance. Make sure you pay all your bills on time, including utility bills. You should take special care to pay your student loans, auto loans, rent, phone bills, credit card bills, and others on time too.
It is a great idea to use online tools and resources to never miss a payment date. You should also consider setting up calendar reminders or automatic payments. If you are currently behind on payments, try bringing them as current as possible.
3. Get Credit for Bill Payments
You can improve your credit score by factoring in your cell phone and utility payments. This is if you have been fairly consistent with making those payments. You can get in touch with Experian ExperianBoost to identify telecom and utility payment history. The payments will be added to your credit file and an updated FICO score will be provided in real-time.
4. Manage Your Debt and Card Payments
Your credit utilization ratio plays an important role in your credit score. You need to pay off as much debt as possible and keep balances to a minimum on credit cards. This holds true for all other forms of revolving credit lines as well. Lenders don’t like anything above a 30% credit utilization ratio.
Often, people with the highest credit scores have the lowest credit utilization ratio. This tells lenders that the applicant is in a healthy space financially speaking and has not maxed out all their credit cards. It also tells lenders that you know how to manage credit and debt.
5. Don’t Apply for Unnecessary Credit Accounts
Opening accounts to have a better credit mix will probably not improve your credit score. It may cause unnecessary harm though. For instance, you probably will not be able to resist temptation and overspend. Keep your cards to a minimum to avoid further accumulation of debt and lower credit scores.