No matter if you hate it or love it, today, a credit score defines our life. A good credit score makes it easier to get mortgages, loans, credit cards, and much more. However, customers having a bad or even fair credit score typically don’t qualify for the best credit deals. Having bad credit can make several things impossible, difficult, or even expensive. For instance, insurance companies often charge a very high premium for drivers who have a bad credit score. If you are planning to get a new utility to be turned into your name, the company might opt to check your credit score to determine if you should pay a deposit. Now after knowing all of these, you may be thinking – how do I fix my credit score? Here we have listed some of the best ways by which anybody can easily improve their credit history.
How Do I Fix My Credit: Best Ways
- Get A Copy Of Your Credit Report And Your Credit Score: At all times, credit repair starts by obtaining a copy of your credit report. Reviewing your credit report establishes what needs to be fixed and how you can fix your credit. You can get your credit report from companies such as TransUnion and Equifax. Due to the fair credit reporting act, a consumer is now entitled to get a FREE credit report from these companies every year. In these credit reports, you can see your FICO score. Remember a FICO score is something that lenders use to make decisions. A credit report will provide a breakdown of each and every line of credit that you have. Account age, account time, missed payments, the number of payments made, late payments, and several other factors are also included in your yearly credit report. Credit utilization, payment history, your types of credit, account age, and credit inquiries are the factors that make your overall credit score.
- Fixing Errors On A Credit Report: Errors in your credit report may be hard to stomach, but they are for real. However, credit errors can be corrected. If you notice any mistake in your credit report, you can opt for any of the two following options:
- Get hold of any credit repair company to do the work for you.
- Generate a dispute with the credit bureaus via mail, phone call, or through other online modes.
Usually, consumers go through a regular DIY approach for minor errors. In case you are a victim of any sort of theft identity, you might be needing a professional helping hand. In both cases, you need to document all the errors thoroughly and then file a separate dispute with each and every applicable credit bureau. Usually, credit companies respond to disputes within thirty days as they need to remove erroneous information when reported. If you are reporting a genuine error, you can easily see improvement in your credit score within a month of your credit report.
- Try Building A Great Credit History And Always Keep Your Credit Account Healthy: Remember healthy credit accounts always build a healthy credit score. Almost thirty-five percent of your credit score depends on payment history. A single late or missed payment can easily knock your credit score down. Missed payments or late payments usually stay in your credit record for almost seven full years.
Another factor resulting in your credit score is the credit mix. Credit mix makes up approximately ten percent of your overall credit score. This is because lenders want to know if you can handle all types of credit responsibly. Always try balancing installment accounts such as mortgages, or car loans with other revolving credit accounts like lines of credit or credit card. It is also important to not apply for several credit lines in a short period of time. If you do, it might result in hard inquiries that have a negative impact on your credit score.
- Always Try Maintaining A Good And Balanced Debt To Credit Ratio: If you are thinking about how do I fix my credit, this is a key point that you should always remember. Suppose you got a $10,000 credit limit in any of your new lines of credit. Now instead of spending the whole of it, try keeping your credit utilization to a minimum or as low as thirty percent. In simpler words, this thirty percent of your credit utilization depends on your self-control. Debt to credit ratio or credit utilization is all about proof of responsibility. Whenever you are keeping your overall credit utilization between ten to thirty percent of your total credit, lenders get an idea about you that you are a responsible consumer.
- Try Reviewing The Overall Age Of Your Credit Accounts: Installment accounts or older revolving accounts that are kept in good standing look great on your credit report. Most of the credit bureaus, look at all your accounts and then calculate an average credit age. So in such cases, it is important to close any older lines of credit or even credit cards. Approximately fifteen percent of your overall credit score hinges on your average credit age .If you are new to the world of credit, try applying for a secured credit card or a credit-builder and always try to use it sparingly while generating your first credit history. All other types of credit builder loans can also help in this regard. Over a period of time, you will be appearing on credit bureaus radar and soon you can become eligible for better lines of credit or credit offers.ore At Credit Rent Boost we work hand in hand with tenants and homeowners in order to report your monthly rent payments with major credit bureaus of the US. If you want to know more about us or if you have any further queries about anything, don’t forget to visit our website.