how to improve your credit score

Is your credit score below optimal? 2020 has been a very tumultuous year financially for many people and many credit ratings have taken a beating so far.

If this is where you find yourself in 2020 you may be worried that this will prevent you from scoring that great mortgage and landing your dream home, and rightly so. With that in mind, we invite you to take a look at the credit score improvement tips below.

Arm Yourself with Knowledge

You cannot tackle a bad credit score without first knowing about it. So your very first step, of course, is to access a copy of your credit report and identify the elements on it that are dragging your score down. You also need to set clear financial goals (with the general idea being to reduce your debt to income ratio)and start working towards achieving them. This, of course, means you will have to budget your income and spending according to your goals.

Automate Your Bill Payments

If your bills are being paid on time then your credit rating will improve. You can do this by setting up standing orders between your bank and your creditors. By doing this you eliminate the risk of inadvertently leaving a bill unpaid or paying it late, both of which are detrimental to your credit score. 

Score an A on your Credit Card Report Card

The first thing many people think about credit cards is debt. But a credit card can be a good thing if you’re on a credit score improvement mission. If you manage a credit card well, your credit score gets an automatic score improvement. This means being punctual and diligent with monthly payments.

Financial loan entities like V5 Solutions help you to keep tabs on your credit rating by arming you with your credit report information when looking for a loan against your car. Once you apply for a V5 logbook loan online with V5 Solutions, you are offered the option of getting a credit check done (typically resulting in higher loan amounts and better rates). If you access their loans and repay in keeping with the terms you’ll also be one step closer to reaching your ideal credit score.

Tackle Each Debt Incrementally

Show that you are a responsible debtor by making payments on your debts. Adhere to the payment deadlines and make full payments where you can. If full payment isn’t possible, ensure that you make part payments. It is also extremely important that you keep in touch with your creditors and ensure that they are assured of your intent to settle your debts.

Become an Authorised User of an Account

Improve your reputation as someone in good financial standing with the support of your close network. When you become an authorised user of a credit card account that is in good financial standing, your credit score improves. Of course, this means you need to be in a trusting relationship with the account holder. You can talk to close friends or family members about this arrangement.

Eliminate Errors

Be your own advocate. Carefully examine your credit report to identify any damaging errors that maybe there and take steps to have them corrected. Look specifically for unfamiliar or unauthorised accounts and misrepresented figures. Also, keep an eye out for payments that you actually made on time but which are recorded as late payments in your report. It is a good idea to do this annually and to try to get the errors fixed promptly.