Most people only think about their credit score when they’re about to make a big purchase, such as buying a house, but you’ll be doing yourself a big favor if you regularly keep an eye on it. Your credit score will determine how much you pay for a loan – if you even qualify for one to begin with – and from there it can cause serious delays in your purchase, if it doesn’t limit your borrowing options from the start.
Perhaps you can’t bring yourself to look at your score because you know your credit is bad. Don’t worry, there is some good news on the horizon. While bad credit is expensive and difficult to deal with, it does not mean you will be miserable for the rest of your life. There are a few basic steps you can take to begin improving your rating.
Check everything is accurate
It might seem basic, but the first thing you should do is get a copy of your credit score and see where you stand. There might even be some discrepancies in your basic information that might affect your score, such as your name or current address. It’s also good to look at the accounts and make sure they’re all yours. If you spot any mistakes, for example, sometimes accounts you closed long ago are listed as open, then you should call the credit bureau and have it corrected immediately.
Collect evidence of mistakes
If you find information that is incorrect, you need to gather as much evidence you can to prove otherwise. Of course, some things are not easy to prove. If someone has fraudulently taken out a credit card in the name, it will be difficult to prove that you weren’t the one who filed the application. Ultimately, the burden of proof is on the creditors. If they can’t corroborate that the information on your report is accurate, then the negative items must be removed from your account.
Get good advice
Clearing your credit score is not as easy as just paying off your credit cards and other debts. If you want to get better mortgage deals or loan options, you need to start building a good credit history. If you need help with this step, you need to find out what is the best credit repair company to help you build your good credit.
Apply for credit you are likely to get
Ultimately, one of the best ways to improve your credit is by building up a good credit history. If your bad credit is likely to hold you back, only apply for credit you are likely to get. You should also not make too many applications at once; lenders perceive that as desperation, so it’s best to spread them out. Show lenders you’re a responsible borrower by borrowing and paying it back. Only spend small amounts and then keep clearing the balance, thereby not being charged interest. You need to do it for at least six months.