Your credit history is nothing but your track record for paying back the loans you take, as well as the level of your debt and the access you have to certain credits. Your credit information is collected and kept in a credit report and these reports can be accessed by various people, although they?ll need your permission.
Various Ways to Fix Your Credit
Your credit history is nothing but your track record for paying back the loans you take, as well as the level of your debt and the access you have to certain credits. Your credit information is collected and kept in a credit report and these reports can be accessed by various people, although they’ll need your permission.
Your credit report form the basis of your credit score. This credit score is a numerical index of how credit-worthy you are. Mostly, borrowers with credit cores that rank above 750 are regarded as extremely credit worthy, while people with credit scores less than 650 are considered as poor.
So if you fall into the latter category, you’ll definitely want to know how to fix your credit.
Regard the following tips:
Carefully (and regularly) skim through your credit reports
There’s a lot riding on credit history and you’re obligated to check your reports on a regular basis. You’ll want to be sure that the details embedded in your report are accurate and they give a correct representation of your borrowing history. If you see any suspicious activity, it might be a pointer to identity theft or any other crime.
In the event that you find any errors in your reports, make sure to do all you can to correct it. Contact the lender who reported the inaccurate score and ask them to make the necessary updates in order to correct the errors on your account. In special cases, it might also be necessary to contact the credit bureaus as well.
It’s a lot of stress, but you’ll find that its time well spent, especially considering what is at stake.
Don’t delay with paying bills
The most influential determining factor on how good your credit score really is will be whether you’ve been able to finance all your loans and how quick you were able to do so. Your payment history is a big percentage of your score, and you need to make sure that every outstanding bills and loans are paid pronto.
According to FICO, a whopping 96% of people who have outstanding credit scores have a habit of paying ills quickly.
Control your balances
Your utilization of credit also has a big impact on your score. This is basically the percentage of your revolving credit that you’re currently using. Although FICO says that consumers with outstanding credit use just 7%of their available credit lines, anything below 30% should be just fine for anyone.
If your credit is low due to high balances, then you can start by paying them down. Remember that even if you pay your full balance on a monthly basis, the ratio of your debt to credit will still vary depending on when exactly your creditors report to the credit bureaus.
Be careful when applying for new credit
Make sure not to apply for many loans at the same time.
Why?
First, the average age of your credit line makes up for about 15% of your total credit score. That means that the higher your average goes, the better your score will be.
Also, new credit inquiries have the potential to lower your credit score. These account for 10% of your credit score, so you can imagine the impact they’ll have.
All this is to say that you need to be extra careful when applying for loans. An error in calculation can damage your credit score even the more, and you sure done want that
