3 Steps for Fixing Your Credit!
Updated: Aug 10
Having bad credit can affect you in many ways. It can get your loan application rejected, it can prevent you from renewing your cell phone contract or even make it difficult for you to rent an apartment. That’s why it is important to ensure that you regularly check your financial report to ensure that everything is in order. The good thing is that anyone can download the report for free. Doing so from time to time will help you track your rating and detect if there are any mistakes. You should know that most banks won’t approve your loan application if your score is below 670. This is because they consider you a high-risk borrower. That’s why credit education is important. What leads to a bad credit score? There are several things that affect your financial rating. One of them is your repayment history – which contributes up to 35%. Your score will negatively be affected if you are used to paying your bills late. Another thing that affects your score is debt repayment. It accounts for 30% of the total score. Banks and other financial institutions always share information regarding your debts. In case you delay in repaying your debts early, the same information will be shared and used to improve your score. Late payments will automatically reduce your overall score.
1. GET YOUR CREDIT REPORT
You should study the report and find out the things that are affecting your score the most. For instance, if it is your payment history, take note of it. 2. ERRORS? FILE A DISPUTE!
Although errors are rare, they do happen. The next step after finding anomalies in your report if to file a dispute claim with the relevant institutions – Equifax, Transunion, or Experian.
They will definitely check your claims and correct the errors upon reviewing and approving them. 3. STOP THE BLEEDING
After dealing with errors in your report and filing a dispute claim, it’s time to start living within your means and get a higher score. You can do that in three simple steps: • Clear your bills on time • Pay your debts • Avoid borrowing loans
This will help you to check and pick any mistakes that might have affected your score negatively. You can download your report anytime for free from the authorized bureaus. You can also seek the help of a financial expert or a friend to analyze the report. You should study the report and find out the things that are affecting your score the most. For instance, if it is your payment history, take note of it. In nutshell, your score can affect you in many ways. The best way to improve it and stay safe is by paying your bills on time, paying your debts and avoid taking unnecessary loans. Besides that, learn to regularly check your financial report to determine if there are any errors that could be lowering your score. You should also seek credit education from experts to understand how your score is generated.