Improving your credit score
Improving your credit score is vital if you want to get the best rate on loans. In some cases, if your credit is bad, you may need to improve your score before you can qualify for credit at all. Improving your credit score can be a challenge, but here are five tips to help:
1) Check For and Remove Inaccuracies
Credit reports are created based on information from the three major credit bureaus and they are not always perfect. Inaccurate information on your credit report can result in adverse negative data being shown that doesn`t actually belong to you. This can drag your credit score down unfairly and make it impossible for you to get credit.
To avoid this problem, check your report regularly to identify any inconsistencies or errors. If you find one, report it to the credit bureaus. They are required to look into it and to make the correction.
2) Pay Down Debt
Thirty percent of your credit score is determined on how much of your available credit you use. This means that if you have your credit cards maxed out or close to the limit, you are going to have a lower credit score than you would if you have a lot of credit available to you. As such, one of the single best things you can do if you want to improve your credit score is to take steps to pay down your debt. If you can keep this ratio at around 30 percent, you are likely to achieve the most favorable rating for this component of your score.
3) Borrow Someone Else`s Credit
If your own credit history is short, or not very good, you can ask someone you know and trust (who trusts you) to add you as an authorized signer to one of their cards. This will then make the card show up on your credit report and you`ll get the benefit of the other party`s history of good credit. The other person never even needs to give you the card if they don`t want to, so you can enjoy this benefit of reported good credit without putting your friend at risk.
4) Contact Your Creditors and Ask Them to Remove Negative Info
If you have a late payment but you have been good about paying your debts, you may be able to get your creditor to change the way the payment is shown. Likewise, if you are settling debt with a creditor, you will want to build it into the settlement (if you can) that the debt will be reported as paid, or that it will be removed from the credit report, instead of being reported as settled or negotiated.
5) Wait and Pay on Time
Whether the above tricks work for you or not, there is no substitute for paying on time every time and for building up a long and legitimate history of good credit. If you have a lot of late payments or other negatives on your record that are accurate and can`t be removed, nothing is really going to fix your score or give you high credit other than the passage of time and the proof you have turned over a new leaf.
Negatives begin to matter less and less as time passes, especially if all of the reports since the negative information show you are responsible. So, simply pay your payments on time and allow time to heal the wounds to your credit.
If you don`t have a card, you`ll need to get one to start to build up this good payment history. With a credit card like the Virgin credit card at Moneysupermarket.com, you can easily obtain a great credit card to use on a regular basis to improve your score.