Easy Ways to Improve Personal Credit Score
Your personal credit score is your responsibility. A credit score can be described as a numerical expression of a person’s credit file and their creditworthiness. Credit scores range from 300, being very poor and 850, being excellent. Poor credit scores are quite common but with these simple steps a poor score can be improved :
CHECK CREDIT REPORT FOR ERRORS
Everyone is entitled to a free credit report. Request one from your credit bureau and check for errors. Common errors include mis-spell personal information, duplicates, credit limits, etc. Submit these errors despite how minor they may seem, to the relevant credit authority as your credit report directly affects your personal credit score.
PAY BILLS ON TIME AND CATCH UP ON MISSED PAYMENTS
Paying bills on time will not be reported. However, delinquencies such as overdue payments are reported to a debt collector and this will affect your personal credit score. To avoid this simply pay on time.
INCREASE YOUR CREDIT LIMIT
Contact your credit provider and to request an increase in credit limit. For instance, if your limit is $1000 ask for an increase to $2000 thereby cutting your credit utilization in half. Be careful however to not spend this credit until the balance is repaid or else you will find yourself with worse credit. This is a temporary solution. Do not raise the limit above what you are able to afford.
Repay your loan debt starting with your credit card bills. Formulate a payment plan which does not involve the use of your credit card.
USE CASH NOT CREDIT
When purchasing, use cash. You can only purchase as much as your cash can buy. When using a credit card you may be tempted to splurge.
Reduce excessive spending and debt accumulation by making a budget. This gives you an exact idea of how much money is available to spend and how much could be spent repaying debt.
SEEK FINANCIAL ADVICE
Certified Public Accounting Firms (CPA Firms) have well-trained accountants who are able to analyze your current financial situation and serve as financial advisors to improve your credit score.
Improving your personal credit score will not happen overnight and will take patience. Bad habits such as late payments, overspending and using excessive credit will not only lower your credit score but ruin your chances of getting credit in the future.