If you have been turned down for credit in the past or are concerned that your credit score could affect you securing a credit card or loan, then don’t worry. There are simple steps that you can take in order to improve your score and creditworthiness. There is no single or universal credit rating system that lenders use when assessing a credit application. Which means your application could be rejected by one lender but accepted by another one. However, this doesn’t mean that you shouldn’t always be looking at ways to improve your overall credit score. This often brings confusion to consumers and why so many opt-in for alternative credit options such as guarantor loans and car leasing for bad credit. But, if you are looking to improve your credit score in a few different (but easy) ways then keep on reading as we are going to share the best ways that you can do so.
Register On The Electoral Roll
Registering on the electoral rolls provides credit lenders with a proof of address and is checked as part of your credit score. If you are eligible to vote, then you should register as it will also help to improve your credit score and is really easy to do so.
Check Your Credit Report for Mistakes
Your credit report holds a comprehensive history of your personal finances, which can include any accounts that you have settled or any payments you have missed in the past. Sometimes this information can be incorrect, so it’s essential to check your credit report for mistakes. If you obtain your report and something doesn’t look right then you need to contact the credit report provider and ask for these mistakes to be corrected.
Make Your Payments on Time and In Full
If you want to improve your bad credit score, then you need to start making your payments on time and in full as this is the single most influential thing that will help improve your score. If you are behind on your payments, then try to get caught up as soon as you can. Simply put, your credit score will not improve until you can consistently pay every one of your bills on time and in full.
Don’t Apply for Too Much Credit
Each time you apply for a credit product, lenders do a ‘hard search’ on your credit report. This leaves a negative mark on your credit report that can be visible to other credit lenders. If they see several hard searches being recorded on your credit report in a short space of time, then it could look like you are struggling with money. This can reduce your chances of being accepted for a credit product in the future.
Close Down Any Credit Card Accounts You Don’t Use
If you have applied for various credit cards over the years and don’t use some of them anymore, then you should consider closing them down. A large credit limit across multiple different accounts, even if unused, could be seen negatively by some lenders and affect your chances of securing credit in the future.
Have An Emergency Pot of Money
People often fall into debt because surprises pop up, and it just seems easier to put the unexpected expenses on a credit card and settle the money at a later date. But, for many people, later never comes around because other expenses keep coming up which are further put on the credit card. This causes your credit card balance to inflate, and that leads to a poorer credit score. The best way to avoid this from happening is by having a separate emergency fund in place. So, if you need to use the cash instead of using a credit card, then you have that to fall back on.
Use an Eligibility Checker Before Making Applications
You can avoid credit application rejections by using an eligibility checker. It means you can check how likely you are to be accepted for a credit product before applying for one and ultimately getting rejected, which can further affect your credit score in a negative way.