If you have a poor credit score and it is impacting on your ability to obtain a loan or a credit card, you may be feeling rather low. So much of modern life is associated with credit and it is only natural that people who are denied credit will find that they are prevented from doing the things that they want to do.
This doesn’t have to be the case though and if you have a poor credit score, you need to take action to improve your credit score. It may not bring about immediate changes but if you want to ensure that you have a good future ahead of you, being proactive in dealing with your credit score is likely to have a positive impact.
If you do have a poor credit rating, one of the smartest things you can do is stop applying for credit. The more applications you have for credit on your record, the more doubts that a lender will have about you. They’ll view you as someone who is desperate for credit and this will lead to them that you cannot handle your money properly. In this regard, someone who has applied for a lot of credit in a short period of time will find that they are more likely to receive other refusals as opposed to the support that they require.
Take Steps to Improve your Credit Score
This can be hard but if you have a poor credit rating, you need to stop applying for credit until you can make a positive impact on your score.
One very simple thing you can do to possibly improve your credit score is to ensure that you are listed on the electoral register. People who aren’t listed on the register find it harder to obtain credit so make sure that you take steps to change this.
If you have credit cards that you aren’t using, you should look to cancel them. This is a smart move because it will minimise the likelihood of being a victim of fraud, but it will also be one less thing for lenders to look at and think about. If you have access to credit and you aren’t using it, why are you looking for more? This is something that lenders take into consideration when looking for a loan, so don’t be in a rush to have credit that you aren’t using, regardless of how much available credit is open to you.
Pay your Bills on Time and in Full
One of the simplest pieces of advice that people with bad credit need to hear is to pay their bills in full and on time. It is a very simple piece of advice but doing so will make a difference. You should also look to pay more than just the minimum payment as well. First things first, look to make a payment that meets your credit requirements but after this, you need to go beyond the minimum amount. This will help you to pay off the debt quicker but equally, if you only pay off the minimum amount every month, lenders will have concerns about you.
Some lenders will view this action as a sign that you don’t have the funds to pay off any more money than you already are, which means that they could have big doubts about your ability to pay more in the future. If you want to ensure that you are viewed in the best possible light by lenders, pay on time and try to pay more than just the minimum amount.
With this in mind, it may be of benefit to find a way to obtain credit that alolows you to pay money off. There are credit builder cards on offer that provides you a small amount and then you pay it off with a fixed payment every month. These cards are usually available for a year and if you clock up 12 months of successful payments, your report will state this, which means that you will be regarded as a safer option by lenders.
Many people also turn to guarantor loans. The presence of the guarantor makes a big difference to the lending company and the APR is based on the good credit score of the guarantor as opposed to the applicant. If you can obtain this style of loan and make the payments every month, you can improve your credit score while gaining access to the funds you need.
Andrew Reilly is a freelance writer with a focus on news stories and consumer interest articles. He has been writing professionally for 9 years but has been writing for as long as he can care to remember. When Andrew isn’t sat behind a laptop or researching a story, he will be found watching a gig or a game of football.