Your credit rating score or score is a number which determines your creditworthiness or risk for lenders. This also determines if you if you can also apply for services like Mortgages, Loans, Car Finance, Credit Cards, or Mobile Phone Contracts. So, why should you even care to improve your credit rating in the first place? The first and the most obvious reasons is to be able to save money, by obtaining better finance products and stop getting rejected anytime you apply for. However, applying for finance products on the other hand also damage your credit rating but it is needed and important in a challenging economic environment,
If you have got a poor credit rating, you should immediately make efforts to improve it. If you have got an excellent rating, chances of getting a good loan with attractive interest rates are higher. We have listed below some great tips that will help improve your credit rating:
1. Be aware
The first step is to find out where you stand by being aware of your credit history. The most important step to moving forward is to know what your credit status is and why it is the way it is. You can do this for free online at a number of websites.
2. Have a thorough look
Make a list of anything you think may be incorrect and you will be able to see where your credit rating may have dipped from this. Be thorough and go through everything in detail. For instance, a phone company may have listed an overdue payment, but you never recall being late with this.
3. Follow up anything you are unsure about
In the example used before about the phone company, call them and find out why they have listed as a discrepancy on your credit file. Take the list of what you are unsure about and follow it up. If it is incorrect then you should be able to dispute it. In that case too, you should request that it be taken off your file as soon as possible.
4. Learn from your mistakes
Now that you know what can give you bad credit, the next step is to make sure that this doesn’t happen anymore. If you have a tendency to get cash loans and don’t pay them back on time resist getting them if you can’t afford them. Knowing your limits in terms of making repayments will not only make your credit status better and you also need to live within your means.
5. Improving your credit rating fast
This is how it works: credit rating is based on the spending versus your repaying and basically you can’t get a credit status or change it without using credit, so the key is to use credit as much as possible, but always make sure you can make the repayments. Therefore, the more you use credit, paying it back on time, the better your credit rating will be.
Although it’s easy to see why so many people want to improve their credit rating, many people are still intimidated by the process. Hopefully, after reading this article you now realize that it is relatively easy to improve a person’s credit score, it just takes time and determination.