Overview of Credit Score in Brief

2 min read
Credit Score

Credit Score

Your credit score plays an essential role in your life that can help put you on the right path towards financial success. It can affect everything from whether or not you get accepted for an apartment to getting a low-interest rate on the car loan. If you have a shallow credit score, you can end up paying hundreds or even thousands extra in interest over time, fortunately, there are the variety of easy steps you can take to start building good credit. Here are five ways you can improve your credit score starting today.

One of the considerable things that affect your score is a record of timely payments. When you are fudging bills and expenses, it can be easy to lose track and end up missing one, which can negatively impact your credit score.
To avoid missing payments, set up automatic payments for your reappearing bills, like rent, cable, and electricity. For other bills that do not fall monthly, such as health, term & car insurance, put reminders on your calendar to remind you to pay before the bill is due.

Use less than 30% of your available. For example, you have a credit card with a limit of 100,000, and you have a balance of 30,000. That means your credit utilization is at 30%. Use less than 30% of your available credit to keep your score high. If you frame up too much of a balance respective to your limit, your score will go down.

There are a variety of services that give you a free credit report, so there’s no excuse to not know your credit score and monitor it. Regularly review your credit report for any errors, such as unauthorized accounts or credit cards that do not belong to you Inaccurate charges can end up bringing down your credit score.
Because credit utilization plays a big role in your credit score, you can increase your score quickly by asking for a credit line increase. If you are in healthy standing with your credit card company, meaning you have not missed or skipped any payment, you can call and ask them to raise your credit limit. Having a larger amount of credit available, your score will go up.
If you do increase your credit limit, it can be alluring to spend a little extra, now that you have more credit available. Don’t fall into that trap! Keep in mind to use 30% or less of your available credit to keep your credit score high. Consolidate credit card debt Credit cards are a form of revolving debt, while personal loans are installment debt. Having a variety of different types of debt on your credit report can help increase your score.

Leave a Reply