How To Improve Credit Score
What is a good credit score? It’s a triple figure number that determines your eligibility for acquiring loans, mortgages, etc. It depicts as to how likely you are to pay back the borrowed money in time. The higher the credit score, the more chances you have to opt for the best health insurance plans. Wondering as to how to boost credit score overnight or how to raise credit score by 200 points?
Here are 5 simple steps that show how to improve credit score:
Time is money; Time is credit score: The best way to boost your credit score overnight is to make all your bill payments in time, always. Your credit score is calculated keeping your payment history in mind. Make a remarkable payment history by paying your bills within a span of 30 days each time in order to achieve a good credit score. It will not only increase your eligibility to avail the best health insurance, etc. but also help in deciding your interest rate. Missing even a single payment or paying after 30 days can reduce the score by 100 – 300 points instantly.
The right credit utilization ratio: The basic idea is to keep the debt as minimum as possible so that you make yourself a low-risk candidate in the eyes of the money lenders. One of the best ways as to how to improve your credit score is by keeping your credit utilization ratio as low as possible. Ideally, the balance should not exceed more than 30% of the credit limit. Additional credit accounts/ cards can help divide your expenditures amongst them in order to maintain the 30% mark in all accounts.
Accuracy is the key: To avoid confusions and miscalculations it is vital that you keep reviewing your credit report periodically to spot any inconsistencies and errors so that you can rectify them and salvage your credit score.
Good debts and credit score: Good debts are those that you have successfully handled in the past by paying the instalments promptly and as per the agreement. The longer the list of good debts, the better will be your credit score. That is why never be in a hurry to close old credit accounts. Let them reflect on your credit report in order to highlight the fact that you are capable of handling credit wisely.
No risk; more credit score: Avoid acts and behaviour that can make you look like a high-risk candidate. Skipping payments, a sudden reduction in payment amounts, taking an advance, using your credit cards at places that can possibly lead to financial stress (gambling websites, pawnbrokers, etc.) – all attract negative credit ratings.
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