During these challenging economic times, many people are finding themselves with less-than-stellar credit scores. The good news is there are many things you can do to improve your score. With regular monitoring of your credit and some useful tips to boost your score, you can bump your number up to something you can be proud of.
Regularly Check Your Credit Report
In order for you to know where you actually stand with the three credit report agencies (Equifax, Transunion, and Experian), you need to take a close look at your credit report on a regular basis. At a minimum, you should view your credit report once a year– but quarterly is optimum. By analyzing your credit report regularly, you can check for errors or problems and take the necessary actions to correct them before they negatively affect your credit. Monitoring your credit report is also a good way to prevent identity theft, a crime that can send your credit score into a swift, downward spiral before you even know you’re even a victim.
You can obtain copies of your credit report from all three credit reporting agencies at www.annualcreditreport.com once each year at no cost. Some states allow for even more free access. Check the laws in your state.
With a paid membership to Experian’s 3-In-1 credit reporting service, you can check your credit report as often as you’d like, and even have notices sent to your email if there is any unusual activity showing up on your credit report.
Establish Credit History
Building up your credit history takes time– but if you do it right, you’ll be on track to a great score. If you have very little or no credit, a good way to start is to take out a small loan such as an automobile loan or get a secured credit card with a reputable bank in your area. You may have to start out small, but responsible credit use will be reflected in your credit score. Over time you will become eligible for larger loans and credit lines– and before you know it, you will have established good credit history.
Make Timely Payments
Failing to pay your bills on time or skipping payments altogether will have a negative impact on your credit score in a jiffy. Always make payments on time, and avoid missing payments at all costs. If you know you can’t make a payment on time, contact your creditor to let them know– in some cases they may be willing to work with you or give you an extra couple of days to make good on your debt.
Keep Credit Card Balances Low
Another way to improve your credit is to work at keeping your credit card balances low. Never max out your credit cards. It’s better to have a couple of credit cards with small balances than one card that has reached its limit. Just because you have the credit line doesn’t mean you need to use it up– if possible, pay balances off each month so your credit card is freed up in case of an emergency.
Maintain a Steady Job and Residence
If you’re working towards improving your credit score, it’s important to establish steady employment and a permanent residence. If you hop around from job to job or change addresses too frequently, lenders will be hesitant to work with you. This, in turn, will hurt your chances at building good credit. This doesn’t mean you can’t change jobs or you should turn down a better opportunity, it simply means you should think twice before jumping around if it seems to be a negative pattern.
Create a Budget
If you make a budget and stick to it, you will undoubtedly have a better chance at improving your credit score. Take the time to figure out how much money you are bringing in and keep your bills organized. This will not only help you pay your bills on time, it will also prevent you from overspending and frivolous credit card use.
As you can see, there are many ways to improve your credit score. By keeping a close eye on your credit activity and practicing responsible use of your credit, you’ll have your credit score up in no time.
Guest post from Bailey Harris. Bailey writes for CreditScore.net, a site that offers the opportunity to get a free credit score.
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