Friday, March 23, 2018

Understanding How to Improve Your Credit

When you're making a big purchase like a house or a car, you'll definitely need to have a good credit score. Even if you're just buying something like a couch or a new phone, you might need a good credit score if you don't want to pay a huge amount upfront. Renting an apartment or getting a student loan for education are also going to be easier if you have a higher credit score. If your credit score is high, interest rates on anything you borrow will also be lower.

While having good credit can make life easier, having poor credit can certainly be a challenge. Assuming you qualify for a loan or a credit card, you can expect high interest rates. So how can you go about fixing your credit? When it comes to improving your credit score, there are a number of helpful strategies. Here are four things you may want to try.

Check Your Credit Score

The first step to improving your credit is to know what your credit score actually 
is. Services like Credit Sesame offer a free credit score so that you can easily find 
this out. If you know where your score is and where it should be, it will be much 
easier to make a plan. If your score is below 550, it’s bad and needs work. If 
it’s between 550 to 649, it’s poor and could still use some work. If it’s in the 
range of 650 to 699, it’s fair, but you should really be aiming for a score over 
700. Scores over 750 are considered excellent.

Have Some Active Credit and Use It Responsibly

If you have an active credit card, start using it responsibly. If you don't have
 an active credit card, you may need to open one. This may mean opening 
a secured credit card with a deposit. Making consistent, timely payments 
and not utilizing all of the credit that is available to you is a great way to improve 
your credit rating.

Try to Work with Your Creditors to Pay Off Debt

If you have a lot of creditors coming after you, you might want to just ignore all of 
their calls. Don't do this. Instead of refusing to deal with it, talk to your creditors. 
They may be willing to work with you. They may accept lower payments or lower 
the interest that you owe. You're never going to know if you don't try to talk to them.

Don't Give Up

It might seem discouraging to have low credit. You may feel like you are alone, 
but you definitely are not. Many people have been where you are now, and they 
have fixed their credit. You can too. The most important thing to do is make sure 
that you don't give up. You don’t need to beat yourself up for making some 
financial mistakes when you can act to fix them. Stay persistent and dedicated, 
and you will raise your credit rating in no time.

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