Only a decade ago, credit ratings were only used to approve or reject loan applications. Today, however, they are used for much more. For instance, landlords normally carry out credit checks to check how an individual has been servicing their loans in the recent past to determine whether or not they are able to pay their rent on time. Anyone with a poor credit score can expect their tenancy application to be rejected. Car hire companies also carry out credit checks, so anyone with a poor credit rating can expect to have their application rejected by car hire companies. This is because. Most lenders and financiers nowadays use credit scores to calculate interest rates. Consumers with low credit scores are deemed to be much riskier than those with decent credit scores, so they are often forced to pay higher rates of interest.
Causes of Poor Credit
As you can see, credit scores are incredibly useful nowadays. That is why it is important for every consumer to maintain a high credit rating. There are many causes of poor credit scores. The main ones, however, are; late loan payment, failure to service your loan and failure to pay the full monthly installment on time. Foreclosure and bankruptcy can also reduce your credit score significantly.
Building Your Credit Score
To build your credit, you only need to borrow short-term loans and service them accordingly. Lenders are required by law to report both negative and positive credit histories, so if you repay your loan accordingly, you will grow your credit rating. Unfortunately, this strategy takes time, so you may want to consider hiring a credit repair company to help you out. There are many types of credit repair programs currently in use, but none of them has met client needs and expectations. In fact, it seems like Credit Secrets is the only credit repair program that works. In just 90 days, the credit repair program promises to increase your credit rating significantly. There are people who have raised their credit score from 450 to 750 in just three months. No other program has this kind of track record. You may want to look for more information on Credit Secrets to find out if it really works. Fortunately, there are many resources that can help you with this.
For many people, credit score is a tricky little number. They really don’t understand what it is or why their number is what it is. Simply put, your credit score, also known as your FICO number, is a number that’s assigned to you by lenders. It indicates your ability to repay a loan. Check out https://www.facebook.com/creditsecretsbook for secrets to improve it.
Calculating Your FICO Score
Fair Isaac, the creators of FICO, start assigning people with this number once they have some credit. However, the company really doesn’t say how they figure this number. What they do tell us are the weights of the various numbers they use. These include:
35% payment history
30% amount owed
15% length of history
10% new credit
10% types of credit used
Maintaining a Positive Credit Score
When you’re first starting out and want to establish your FICO score you’ll want to open one credit card. Make sure you use this credit card to buy something small each month. Pay this off right away. You’ll then establish a good credit score for yourself within 3 – 6 months. Or go to https://www.instagram.com/creditsecretsbook/.
Once you have some credit, keeping it positive is essential. Only when you have good credit can you qualify for a low-interest credit. Fortunately, there are some things you can do to improve your credit score. You can:
Keep the balances on your credit card and other types of “revolving credit” low
Make sure you pay off your debts instead of moving it around
Don’t close credit cards you’re not using in hopes of quickly raising your FICO score
Don’t open a bunch of credit cards that you don’t need just to increase the amount of credit you have available to you
Fixing Your Credit Score
Sometimes life throws you a curveball. When the unexpected happens and your credit score suffers because of it, you’ll need to fix it. There are a few things you can do here, including:
Dispute any errors
Pay bills on time
Pay down old balances
Don’t apply for any new credit cards
Remember, your credit score is important. Never neglect it because you don’t know when you’ll need it in the future.
Missteps are inevitable in life. Sometimes we can take on more than we can chew and end up paying for it dearly. For instance, we may take on several loans and get buried in a mountain of debts. We might get laid off or our business venture might tank, leaving us without the means to pay back what we owe. Every time we default on our payments, our credit score takes a hit. A bad score will make it hard for us to obtain loans in the future.
It Gets Better
The important thing is not to despair. This sort of misfortune can happen to anyone at any time. Many who have fallen to the lowest low have since bounced back stronger. There are plenty of ways to repair the damage. Learn from the experience of those who have been there before. This page will contain credit secret tips that you can use to lift yourself out of the predicament and improve your score. It will not be easy or fast but be patient and you will be rewarded.
Avoid Unnecessary Spending
The first thing that you should do is to avoid unnecessary spending. This is likely what got you into trouble so quit the habit once and for all. Prevent yourself from making impulse purchases in any way that works for you. Perhaps you could leave your credit cards at home and pay cash whenever possible. If you are making online purchases, consider using debit cards instead so that you’ll be spending money that’s already there instead of borrowing. Take time to consider all your options, including reusing or repairing old stuff rather than buying new replacements.
Be Careful with Secured Loans
If you really need to borrow money, then you could try to apply for one at banks and other lenders. A bad credit score will lower the chances of approval. Those that are willing to lend money will probably slap a high-interest rate on top of the payments. You could try to get secured loans as a last resort. In this scenario, the lender will look for assurance that you will pay back the money owed. This is usually the title to a property such as a borrower’s home. This can be risky so don’t do it unless you are 100% sure that you can repay on time.