By Natasha Souza - January 26, 2022

Moving Up the Level of Your Credit Score Might Just Be What Is Missing for You to Enjoy the Perks of Credit Products

Why Take the Time to Improve Your Credit Score?

Having access to credit is essential in many moments of life, whether to get a loan, finance a real estate, or apply for a credit card. However, many people do not realize how much their credit scores can affect their lifestyle. As a borrower, your score is what financial institutions look at before approving your request. Depending on the product, low scores are usually denied. 

Having a good credit profile is important not only to get good financial services like better rates for loans, credit cards with higher limits and more credibility in banks and brokers. When a company does its credit analysis, it tries to give you a score, which indicates the likelihood of you paying on time. In fact, be aware that not only banks and financial institutions consult your score. They are available for free at websites such as FICO’s and can be used for other purposes as well. So, be careful, as they can say a lot about you. 

FICO is the credit analysis institution we use as a reference, but there are others as well. By the way, to grant you credit, a company does not necessarily need to consult such data. Financial corporations like banks also have credit departments which calculate their own scores. 

This is why it is very important that you know how to improve your credit, as well as your profile. To help you avoid the stress of going through having a credit request denied, below are a few tips made just for you.

An Easy Six-Step Guide Made Just for You

1 – Settle all your debts: Pull your finances together! If you have outstanding debts, clear your name first. This will increase your score, thus increasing your chances of getting credit. One idea is to look for agencies that help you settle your debts while offering discounts. 

2 – Meet all due dates: From now on, always pay your bills on time. Overdue payments really harm your score, as they show you are not taking care of your accounts. A suggestion is to set up alarms or automatic payments. 

3 – Hold accounts in your name: This helps you to be seen as a consumer and a good borrower, as it fills your report with information. All you will have to do is make sure it is positive information. One idea is to at least open an account to pay simple bills like phone, energy, and water.

4 – Always update your credit information: Not only to say the obvious, which is making sure your efforts to improve your credit appear on your report, but also make sure to update your name, address, age, phone number, etc. 

5 – Purchase on credit: Payments made in cash are not part of your report, thus they will not be used to compose your score. So, try to use your credit card more often, even if you do not want to divide your purchases into installments.

6 – Look for easy-to-be-approved products: Finally, in case you are just starting to build credit, try to begin with products that require no credit history. They are the easiest to get an approval from, not to mention that they are usually the cheapest. This way, you will not start by being charged with too many fees and interests. 

Bottom line 

To be honest, there is no such thing as a recipe to improve your credit. By the end of the day, it is all about making minor changes, like the ones we have suggested, and waiting for the result to appear on the bank’s screen. 

Many people look for the easier and faster way. And now that you know that there is no magic formula, we also want to tell you that what matters the most is being consistently financially healthy in the long term. 

Enjoying your reading? There is so much more we want to tell you! So, keep visiting us, and do not forget to share with your friends and family. 

About the Author Natasha Souza


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