Top Tips for Credit Repair

Credit Repair

Credit scores are an essential part of your life. Even your GA natural gas companies will use your credit history for your bills. Thatís why it is critical to keep your credit score high at all times.

Importance of having a good credit score

In this age and time, a good credit score is essential. You cannot buy anything with a credit or get a mortgage. With paychecks that are overstretched or delayed, you cannot live without credit. Having a good credit score is vital for the following reasons.

  • Determines where you live

Whether you are renting or buying a house, your credit score determines where you are going to live. Most landlords require your credit score before they allow you to sign a lease. If you have a bad credit history, you might get higher rates or even get denied. The same case applies when buying a home. Lenders use your credit history to approve your mortgage plus the rates you pay.

  • Your auto loan requires a good credit score

Most people can’t afford to buy their vehicles themselves. If you think you will need a car in the future, it’s time to take care of your credit score. Your ratings not only affect whether you get the auto loan or not but also the amount you get.

  • Business loans

So, you have finally decided to start your business but are low on cash. Most people will take a loan. However, unknown to many, even your business loans are affected by your credit ratings. A good credit score is a must for a better deal. 

  • Employment

Employers today check their employeeís credit rating before employing them or giving them a raise. If the salary is lower than your credit report, they might not give you the job. Employers also use the credit history to check for financial responsibility when giving you a raise or promotion.

Ways to ruin your credit

There are a ton of ways you can destroy your credit score. Some of the most common include:

Building up debt

Getting into debt once in a while is okay. However, it can be bad for your credit when you pile a few debts on your credit report. It has the potential of lowering or ruining your credit score. Having a variety of loans on your report is good for your credit. However, you need to spread them over time.

Missing your payments

Once in a while, everyone gets into a tight fix and may miss a payment. The problem comes when you are continually missing payments on your loans or debts. Missing payments is the number one way to get poor credit ratings.

Making lots of credit inquiries

There are a lot of companies out their selling credit. They’ll entice you will sweet deal to take their credit cards. One thing to remember, however, is that your credit score gets affected by the different number of lenders you take on. Your credit score could suffer a ten percent loss if you keep adding new lenders. Loyalty is essential when it comes to credit.

Maxing out your credit limit

Lenders usually give you a credit limit. Maxing out your credit limit is living on the edge. A small economic recession or unexpected job loss can put you in big trouble. Reaching these limits is also a sure way to put your credit score in trouble.

Tips to improve your credit score

A good credit score is vital for both work and your financial well-being. If you are not satisfied with your credit rating, there are a few things you can do to improve your score. These include:

  • Checking for inaccuracies in your report

Lenders sometimes make mistakes that end up in your credit report. You need to regularly monitor your credit reports and raise the alarm whenever there any discrepancies. TransUnion, Equifax, and Experian are the three main bureaus that deal with credit reports.

  • Retain your unused credit cards

People tend to close credit cards that they donít use. If you are not charged annually for your account, keep them open. When you have debt but fewer open accounts, you may lower your credit score. 

  • Avoid too much new credit

When you apply for a new line of credit, inquiries are made into your credit report. These inquiries are hard inquiries that remain in your credit report for two years. Although they are only temporary, too many inquiries could cost you up to ten percent of your credit rating.

  • Add utility and phone payments to your credit

If you have been paying your utilities and phone on time, you can add these to your credit report. These new readings can bump up your score by a few points. 

  • Pay your bills on time

One of the best ways to quickly get your scores up is to never miss your payments. Paying your bills on time shows lenders your financial responsibility. Your payments usually act as an indicator of your payment performance in the future. These bills are not just limited to your credit cards but also all other loans, utilities, and rent.