If you are reading this, it’s obviously because you have made a resolution of improving your credit rating. Well, to be able to achieve this, you must be aware of what goes into your credit report to generate a credit score so you can improve your overall credit rating. Here are a number of things that you can do to improve your credit score, although not instantly, but over time.
1. Go Through Your Credit Report
If you want to repair your credit blunders, the very first thing you should do is to check your credit report. If you have not done this already, ask for a free copy of your report and check if it has any errors. It contains all the data used to compute your credit score and, who knows, it might contain some errors.
Specifically, check to ensure that the list of late payments is correct and that the amount of money owed for every open account is correctly computed. If you are lucky to find any errors, file a dispute as soon as possible through the credit bureau as well as the reporting agency.
2. Reduce Your Debt
Although this is easier said than done, observing this will help you improve your credit rating. First things first: stop using your credit cards immediately.
Using your credit report, compile a list of all your open accounts, go through the latest statements, and establish exactly how much you owe on each of them and the interest rates you are being charged. From there, develop a payment plan that directs a huge proportion of your available budget towards the cards with the highest interest rates and maintain minimal payments on the rest of your accounts.
3. Make Payments on Time
To achieve this, you may want to consider setting up payment reminders. Delinquent collections and payments could have huge negative impact on your credit score. The ability to make your payments on time is actually one of the largest contributing elements to your credit score.
There are banks that provide payment reminders via their online portal and can send you emails or text messages reminding you when payments are due. Resolving to automatic payments via your credit card and providers of loans to have payments debited automatically from your bank account.
4. Good Faith Adjustments
Going through your credit report can help you recognize one or two late payments that might have happened for some one time economic challenge that you have since solved. Talk to your creditor and request for an adjustment and if you are lucky enough, you will get an instant boost to your credit score. This will especially work for you if you have been a good customer; your creditor will not have any problem removing one or two late payments for your credit history.
These four tips can help even the most indebted person through a credit score predicament. Follow through each step carefully in order to see a positive increase in such an essential number. Good luck on your journey of credit rectification!