Many people suffer from a poor credit score, often through no fault of their own. It can be nearly impossible to get things like a bank loan or credit card; this can be both frustrating and demoralising. There are several techniques you can use to improve your credit score, which can dramatically increase your attractiveness to lenders in the long run. Below you will find a few easy tips which will help to dramatically boost your credit score.
1) Check your Credit Report: Many individuals are reluctant to check their credit report as it usually involves a monthly subscription. The costs are usually small, and how can one expect to improve their credit score if they have no idea what it is! A detailed credit report will highlight all of an individual’s shortcomings, which are hurting their credit score. It will also highlight any unfair penalties that an individual may be receiving. These can then be rectified. It is best practice to check your credit score once a month. Although credit score checks are shown in your credit history, they don’t have negative affect on your credit score.
2) Be prompt when paying bills: Payment history accounts for a large percentage of an individual’s credit score. If you currently pay bills late, this could be seriously harming the chances of you receiving a credit card, mortgage, or money from a lender. If possible, set up standing orders/direct debits to pay your bills. This removes the process of having to manually pay every bill when the letter comes through the door. It ensures you won’t be late when paying!
3) Don’t overspend on your credit card: Maxing out credit cards has a hugely negative effect on an individual’s credit score. Although spending on a credit card does help improve your credit score, overspending has the opposite effect. Keep a careful eye on your spending when using credit cards. Check your balance online, or even use an app on your phone to make sure you’re not running close to the limit. It is recommended to make small purchases on your card, paid off promptly. This shows a lender that you can budget and manage your money in an efficient fashion.
If you’re troubled with a low credit score, use the 3 tips above to help improve it. It can take time, but in the end, even the worst credit score can recover.
Apple Tree are a small accountancy firm based in Witney, West Oxfordshire. For more information about their Witney Accountants Services, please visit their website: Apple Tree Accountancy
