We may often hear a lot about credit scores and may possibly wonder what they are or how we might be able to improve ours. It is something which we should be aware of as it can have an impact on us. Lenders and landlords will use our credit record to see whether they feel that we can be trusted and so it is important to make sure that they are in good shape if we want to be able to be able to have the freedom to rent a home or to borrow money in the future. There are various things that we can do to improve our credit score to make sure that things are looking as good as they can do.
Make Sure Details are Correct
The first place to start is to look up your credit report and make sure that all of the information is correct. There could be out of date or even completely incorrect things on there so it is good to check for this. For example, you want to make sure that if it says you have contractual obligations, that you still do and if it says you have missed repayments that you actually did miss it. Also check all of the other details such as your employment details and things like this.
Keep Making Regular Payments
Something which looks good on your credit record is the fact that you are capable of making regular payments. This means things such as rent or mortgage, loan repayments, contracts and utilities. If you do not have your name on many of these, then it could be good to add it. So, if your spouse or partner has their single name on certain items, then it could be a good idea to add your name. Then it will show up on your credit report and show that you are making these payments too. Chances are that you are sharing financial responsibility of the home finances so it is only right your name should be on it too anyway.
Pay off Debts
If you can have less debts then this will look better. Even if you are keeping up with the repayments, it can still be a worry form a potential lender if you already have a lot of debt. Therefore, it could be wise to see whether you can stop paying some of them and this will help you to have a better credit report. Therefore, look into whether you are able to overpay your debts or repay them early without charges. Some lenders will charge for this and these are more likely to be mortgage companies. Having a mortgage will not be frowned upon so much, as long as you are keeping up with repayments, compared with other loans. Therefore, it may be better to pay off other things first anyway, particularly as they tend to be more expensive as well.
Your income is really important as lenders will want to see that you are earning money so that you will be capable of making a payment on a loan. Therefore, it is important to make sure that you keep earning money. You will also find that they will look more favourably on employment as compared to self-employment as they feel it is a more secure income. They will also look more favourably on those with higher incomes.
Do not Apply for Lots of Loans
If you apply for lots of loans, even guaranteed payday loans, in relatively quick succession, it can look like you are desperate for money. This does not look good and those applications will show up whether they are turned down or accepted, so make sure that you are careful with what you are doing.