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What are Some Ways That you Can Raise your Credit Score?

Your credit score can affect your finances and your life in a big way. Having a poor credit score can result in denial of loans, failure to secure a good home, and many other financial setbacks. Luckily though just because you have bad credit now doesn’t mean that things will always be that way. With some effort, you can eventually raise your credit score. Following are some of the ways you can achieve this.

Pay your bills on time

Untimely payment of bills can negatively affect your credit score. Conversely, timely payment of bills each month/quarter can help boost your credit score. If you have a backlog of missed bill payments, you should pay them ASAP. Once you’re current, you should consistently pay your bills on time with no delay. It’s even better if you can pay them well in advance. A track record of consistently paying bills on time can eventually raise your credit score significantly.

Control your credit card balance and spending

Maintaining a low balance on your credit card and good spending habits can go a long way in helping raise your credit score. Try not to go over your credit limit when using your card as this can affect your score negatively. Consistently maintaining a balance well below your credit limit can help to raise your credit score as credit card companies will see that you can live within your limits.

Repay your loans and correct bad credit

Outstanding loans don’t look good on your credit score if they are not paid off in time. If you find that you can’t manage to repay them, you should contact your creditor so that you can negotiate a new loan repayment scheme. Most lenders are willing to negotiate even partial payment rather than to lose all their money. If you’re completely unable to pay off your debt you can apply for debt relief with the help of a reputable credit counselor. These steps can help to get you out of debt and help you to raise your credit score.

Manage your bank accounts

Avoid the urge to open new bank accounts just so that you can get additional credit cards. Your overall account age is lowered when you open new accounts. This detracts from your credit score. Opening several new accounts within a short period also gives the impression that you’re a risky client and lowers your credit score. You should also cancel all cards which get you deeper into debt. This last point won’t directly affect your score, but it can help you from lowering your score further due to poor management of finances.

All in all raising your credit score is about being prudent with your finances. Living within your limits and remaining consistent with your financial obligations will eventually help to correct your credit score.

You can get a free copy of your credit score at freecreditreport.com