Having a top-notch credit score is essential in your every day to day life. More and more people need a good one to access things for their life. It makes a person more desirable to employers, landlords, and mortgage lenders as well as negotiating for lower auto insurance rates and other services.
But the million-dollar question is, “What can one do to build their credit score?” If you are wondering the best strategies to guild your credit score, you are in luck. Today we will discuss a few options that will aid you in getting a good credit score.
Ways to Maintain a Good Credit Score
1. Strive to pay your bills on time
Lenders often inquire about one’s credit report as well as request a copy of your credit score. In the real sense, they are more interested in knowing how reliable you are when it comes to paying your bills. An excellent past payment performance indicates a promising future performance.
Thus, you ought to strive to pay your bills at the designated time you’ve agreed to each month. Any late payments will harm your credit score. Your house bills don’t just stop at the credit card bills. You also have to clear pending loans like student loans and auto loans.
It would be best if you also handled your rent, phone bills as well as utility bills appropriately. Have a reminder on your phone or computer to help you to pay your bills on time. You don’t want any negative information regarding bills on your credit report. It can potentially stay there for up to seven years.
2. Pay off debts and keep your balances low
A credit utilization ratio is an essential number within your credit score calculations. Lenders look at the 30% ratio.
People who have lower ratios have better credit scores. It means they haven’t maxed out their credit cards. It also means that they are individuals who can manage credit cards well.
3. Apply or open a new credit account only when required
Are you interested in getting the best credit card to meet your needs? You can check here for the best credit cards. However, you ought to tread cautiously. Don’t go rushing to opening a credit card account to have a better mix of credit cards.
Having additional credit might do you more harm than good. It might create too many hard inquiries on your credit report. Additionally, at times you might get tempted to overspend, which results in accumulation of debt.
Related Content: 3 Reasons Credit Cards Didn’t Work for Me
4. Do not close unused credit cards
Do you have any credit cards you don’t use? It might seem like a smart move to close them. However, it’s not.
As long as the credit cards aren’t costing any money in annual fees, closing them might multiply your credit utilization ratio. If you owe the same amount and have to get open accounts, your credit score may reduce.
5. Dispute any incorrect information on a credit report
You ought to dispute any inaccuracies on your credit report each time you spot one. It would be best if you checked your credit reports every so often to see that all information is correct. Any incorrect information might lower your credit score.
Don’t worry if you have a low credit score or if you lack any. You can check here to see some credit cards for no credit history. It’s a step into building a good credit score. More so, you ought to apply the tips stated above to get your desired credit score.
Leave a Comment or Answer a Question Below: Do you use credit cards? Have they helped or hurt your financial life? What is your best piece of advice for people who are looking to open a credit card account?
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