Applying for a new loan or buying a new item on credit can be difficult and stressful when you have a poor credit score. Once you have a poor credit score, it can sometimes start to feel like you are in a vicious cycle of debt and borrowing. Here, we will look at five great ways to help boost your credit score, so you can apply for new financial products with confidence.
- The first and most simple way to keep your credit score high is to always pay your bills on time. Even missing a payment by a few days can cause your credit score to start to drop, so always keep up to date with what bills are due on each day of the month so you can pay on time, all the time. If you struggle to remember everything, see if you can set up payment reminders to help. You could try using a mobile app, or set up the payments to automatically be removed from your bank account each month on the day they are due.
- Another quick way to get your credit score to increase is to pay back any debts you owe. Whilst this isn’t always easy, it is a sure-fire way to increase your credit score. If you owe to different lenders or on different credit cards, the best strategy is to pay back those which are charging the highest interest rates first. Once those have been paid off, you can start to work on those with lower rates. You must make sure you pay the minimum on each debt every month so you don’t get further behind on repayments which could cause further issues.
- You can also check your credit report, to see exactly where the score has come from. You should also check through it thoroughly to ensure there are no errors which could have falsely lowered your credit score. If you do find any errors on your credit report, be sure to dispute them straight away. In this way, you will probably be able to get your score recalculated, and it might come out better than you expected.
- If you have never had a credit card, it can actually help your score if you get one and use it responsibly, paying it off on time, every month. Some lenders might be sceptical of someone who has never had a credit card before. Look for one with a good rate, and be sure not to spend more than you can afford to pay back at the end of the month.
- If you owe on many different cards or loans, you could try consolidating them all together. You could use a site like LoanMe or http://bankorno.fi/pikalaina/ to borrow money which you will use to pay off your other outstanding debts. You can find a payment plan which is tailored to your needs, meaning you can choose how much you can afford to pay back every month. You can borrow money for different periods of time, ranging from short term to several years. This is a flexible and affordable way to borrow money, which is often accessible to those with a poor credit score too.
Remember, fixing your credit score takes time and patience. There is no quick fix to boost your score, instead it is more about managing your finances responsibly over a long period of time. Once you have paid back all your debt and become up to date with bill payments, it should be relatively easy to maintain a good credit score.