A good credit score is very important when it comes to managing your finances for the future. Whether business credit or personal credit, it represents our borrowing power and enhances our loan options. Maintaining good credit can bring several benefits and allow access to capital when needed for necessary investments.
Here’s 5 hacks to help you improve your credit score-
Out of the many factors that can impact your credit score, making on-time payments is probably the most important. If you have a mortgage, credit card, or a lease on a car, making timely payments can contribute to improving your credit score.
Missing a payment may negatively impact your score, so prioritize scheduled due dates.
Often underrated, making multiple payments during each billing cycle is an easy way to increase your credit score. Credit bureaus regard this behavior as responsible, plus it is a great way to swiftly pay down your balances.
Making multiple payments within one billing cycle naturally causes you to pay more than the minimum due, thus, boosting your credit score. Faster down payments also lead to better utilization ratios.
Autopay helps save your time and maintains your credit score to its highest. If you are looking to improve your credit score, missing one or many payments on your credit cards can seem quite debilitating. However, setting up autopay ensures that your payments are made on time.
A widely available feature at several banks and lending services. You can either set it up online or ask them to help you set it up.
Once you sign up, you can automatically pay off your dues, whether partially or completely, with each billing period. Your decided amount will automatically get paid before or on the due date. In certain cases, you have the option of scheduling the payment for a specific date, prior to the due date.
The credit utilization rate is calculated by the revolving credit you are using divided by the total amount of credit that you have access to. Keeping track of this ratio is yet another important credit score building factor.
Along with making payments on time, keeping your utilization ratio low is the primary catch for the credit bureaus. Most experts would advise keeping your utilization rate below 30%, i.e. you must never use more than 30% of all the credit available to you at any given time.
Credit bureaus also look at the time period for which you’ve had your credit lines open. The longer you’ve had a credit card, and managed it responsibly, the better your credit score prospects.
While not as significant as on-time payments or utilization rates, it can still improve your credit score.
If you want to improve your credit, then it’s important you understand exactly what is needed to impress the credit bureaus. After that, you can take steps to ensure your score remains as high as possible and also avoid common mistakes. For more advice on credit repair, consult our experts at Xander Financial. Visit https://xanderfinancial.net/