Your credit score is one of the most important factors that lenders use to determine whether you will be approved for a loan or not. A good credit score of 750 or higher can help you access better interest rates, favorable loan terms, and higher loan amounts while it can be challenging to even opt for a loan with a low credit score.
So, if your credit score is low and you are looking to fix your credit score to 750 or higher, then fret not. Here are some important tips that you can follow to maintain a good credit score:
- Check Your Credit Report for Errors: Errors on your credit report can hurt your credit score significantly. Review your report for any mistakes, such as incorrect account balances or payments that were incorrectly reported as late and dispute them with the credit bureau immediately.
- Pay Your Bills on Time: Payment history is one of the most important factors in determining your credit score. Therefore, you must pay all of your bills always on time. You can also set up automatic payments or reminders to stay on track.
- Reduce Your Credit Utilization Ratio: The amount of credit you use compared to your credit limits, known as your credit utilization ratio, is another important factor in your credit score. Try to keep your credit utilization below 30% of your available credit to maintain a good credit score.
- Don't Close Old Credit Accounts: Closing an old credit account can negatively impact your as it can reduce the average length of your credit history.
- Avoid Multiple Loan Applications: Applying for multiple new credit accounts in a short period can create a negative impression on lenders that you are credit hungry and potentially pose a higher risk of defaulting on payments. Therefore, it is advisable to apply for credit when you need it.
0 Comments