Credit scores are the most influential deciding factor in whether or not you get your loan, mortgage, lease or credit card. Many people may not think about their own credit score until it is too late, left wondering why they were knocked back. It is important to be aware of your financial behavior before you attempt to seek support. This will ensure confidence when you apply. Here are the top 5 tips on how to ensure a credit rating that will boost your chances of success:
Credit scorers take into account the types of your accounts, how long they’ve been open, the fluctuations in balance, your history of payments, and the current status of your accounts.
If you pay your credit card or debt bills each month, this will be a advantageous statistic to have in your account activity, revealing that you pay on-time and maintain a regular commitment.
If there are multiple instances of late repayments of debts, bills and overdrawn fees in your account, this will bode negatively on your score, as it shows a lack of ability to repay.
If you pay off the accounts and cards that have the highest interest rates first, then this will directly improve your overall score, whilst also cutting down fees and interests. The more credit that is closer to your limit, the more this will impact your overall score, so be sure to know how close you are to your limit so that you can catch it early.
A small installment loan is a great option to build credit scores. Simply, this loan is repaid over a period of time with scheduled payments. Having this in your financial history when applying for a larger loan is a perfect way to demonstrate that you are credit worthy in the regular repayments of the loan (even if repayments are very low).
It’s all about being finance savvy in staying on top of debts and repayments, and creating a financial portfolio that demonstrates your integrity and capability to repay.