There are many points in your life where a higher credit score works to your advantage. Buying a house, applying for car finance, or renovating are just a few worth mentioning. Having a higher credit score can help to boost the chance that you will be approved for better financial products and interest rates.
This means it is important to look after your credit score, and improving it where you can, let’s have a look at how below:
Use A Credit Card Often But Very Little
When you use credit responsibly by using it a little but often it can help to build your score. If you keep your credit card active and only spend small amounts each month, it will make you look more attractive to lenders and ultimately improve your score. You need to show that you are responsible enough to pay it back.
Keep Your Credit Utilisation As Low As Possible
If you want a good credit score, you need to avoid using too much of your available credit. If you keep your utilization to below 30% you should show that you using credit sensibly, and you still have it available for when you need it the most. When you monitor your score, you can see how much you are using.
Make Sure You Correct Any Mistakes
Your credit score depends on the information that is included in your credit report. If this isn’t right, then it’s likely your credit score is incorrect. This could mean that your score shows lower than it should be. You can make sure that the information is right by using things like an address search, and free credit check tools. If you spit any mistakes, make sure you correct them as soon as possible, in some cases, this will mean filing a report.
Limit Your Credit Applications
You may be tempted into applying for credit after credit especially if you have been turned down. However, if you have been turned down you are better off waiting to apply for more credit as too many applications can lead to your score been damaged. Typically the applications stay on your file for 12 months, so try to limit the amount you make in one 12 month period.
Always Use An Eligibility Checker
You can, of course, avoid getting rejected by checking if you are eligible first. Or from using a ‘soft search’. Lenders are able to see some information about your history, but it doesn’t have an impact on your credit score. An eligibility checker will give you an idea of how likely you are to be accepted from credit before you make an application. In theory, this should prevent you from having too many hard search applications on your credit file, these do have an effect.
These are just a few of the things that will help you to keep your credit score where it needs to be as well as improve it if it needs it. Is there anything else you would linclude? Please share them in the comments below.