What is a Credit Score
A credit score is a number that represents how creditworthy a person is. This is information that is based on a history from the three main credit bureaus. It is a history of all the loans and cards that you have had since you began getting credit initially.
This score will help you when you want to get new loans or cards. If your score is higher, you will have a better chance of getting what you want. If it is lower, you need to find ways to improve it so that you can get the things you want and need.
There are ways that you can improve your score, you just need to improve your history. The first thing that you need to know is hva er en god kredittscore or what is a good credit score. A good score is usually above 700.
This article will give you ways to increase your score and your history. It will give you some ideas on how to improve your chances of getting new loans and cards. You can also do more research and find more information.
Raising Your Credit Score
- Pay Bills on Time – Paying your bills when they are due, or even before they are due, will increase your score. This shows that you are a responsible adult that takes their bills seriously. You want to do this all the time, not just a month here and there.
- Balances Low – You don’t want to keep high balances on your cards. This shows that you don’t have control over your spending. You want to make sure that your credit utilization is under 30% so that it looks good in your credit history. You can learn more about that here.
- Check for Mistakes – Get a copy of your report and check it for any mistakes. You can get a free report in many places. Use this to check to see if there are mistakes and then correct them. You can dispute any record that is on your account.
- Pay Down Your Debt – Make a plan to pay down your debt quickly. Some creditors will allow you to make a deal that allows you to pay less than the original balance. Call them and see what you can do to pay your debt down.
- Use Your Cards and Loans Responsibly – Continue to use your cards and getting loans but be responsible with it. You don’t want to go into debt that you can’t get out of by choosing new cards and loans if you don’t need them. Continue to pay your bills on time so that you continue to improve your score.
- Don’t Open Too Many Accounts at Once – Don’t apply for too many cards or loans at the same time or in a short period of time. This will make your score go lower than anything else because all the creditors will hit your report at once. You don’t want that to happen when you are trying to improve.
- Don’t Close Credit Accounts – You might think that this will be good for your history, but the opposite is actually true. You want to have a long history of credit and paying off your bills on time. Having older accounts will help to show that you have been responsible for paying on time.
- Search for New Credit in a Short Period of Time – When you are searching for a new loan, do so in a short period of time so that the report will realize that you are shopping. This won’t hurt your report as much because people shop for new loans all the time. If you only sign with one of these creditors, it shouldn’t hurt your report much at all.
- Be Selective – Be selective about the number of accounts that you have open. You don’t want to have more than you can manage at once. If you have too many, you might not be able to pay for all the accounts each month.
- Talk to a Credit Counselor – If all else fails, talk to a credit counselor. A professional counselor can help you to find ways to pay your bills and get them all on track: https://www.ncoa.org/article/is-credit-counseling-worth-it. They can also help by contacting the creditors and helping you to make a plan to pay them off.
- Request Increases to Your Limit – If you raise your limit, you lower your utilization score. You still need to keep your spending at the lower limit so that your score will lower. Most card companies will let you do this over the phone and online, especially if you have been good about paying your bills on time.
- Become an Authorized User – This will help you to increase your score if the person that allows you to do this has a good score. It won’t work if the other person has a lower score than you do. Being an authorized user doesn’t mean that you need to use the card, just that you can.
- Use Dormant Cards Periodically – As you are raising your scores, you will be getting cards with better rewards. Don’t close out the older cards, instead use these occasionally to keep them active. This will help your credit history and increase your score even more.
- Pay Off the Highest Balances First – If you have more than one card or loan, pick the one with the highest balance and work on paying it off first. Pay on the others to keep them in good standing but pay extra on the highest balance when you can. If you get extra money such as a tax refund or raise at work, pay that card or loan.
There are many things that you can do to increase your credit score. Paying attention to your credit report will help you the most. If you have errors in the report, get them fixed as soon as possible. You can also pay off old debts that may be on your report.