Whether you are just starting out in your adult life or have fallen on some hard times in the past, it is possible to improve your credit score so you can get approved for better, money-saving loans. We have a few suggestions to help get you started.
Pay Your Bills On Time
The biggest detriment to your credit is late payments. Make sure you are making paying your bills a priority in your budget. Setting up automatic payments is a great way to avoid forgetting to make a payment every month. If you find you are always short on funds, track your spending to see where you can make some cuts.
Pay Off Debt
If you have a high credit utilization ratio, this could be pulling your credit score down, too. If you frequently carry a balance on your credit cards or have a lot of loans, try to pay off some of your debt. A good credit utilization ratio is 30 percent or less.
Only Open New Credit Accounts As Needed
Do not open any new credit accounts, unless you absolutely need it. For example, don’t apply for every in-store credit card. You can always say no when the cashier asks. In addition, every time you apply for credit, it shows as a hard inquiry on your credit report. Too many inquires can have a negative effect. These inquires stay on your credit for two years.
Do Not Close Old Accounts
If you have a credit card that is paid off that you no longer use, leave the account open. This will help improve your credit utilization ratio. You can always cut up the card, so you are not tempted to use it.
Check Your Credit Report
Every year, you are entitled to a free credit report. Take advantage of this and look for any errors on your report. Dispute any information that you feel is incorrect.