Published On: Thu, Nov 11th, 2021

How To Improve Your Credit Score

Credit score

Your credit score is very important to your financial life. It will determine whether you can get a good interest rate on loans, such as for a car or a home. A good score will allow you to open credit card accounts, which are important to have for modern life. You need a credit card to rent a car or pay for a vacation. Here are some tips for increasing your credit score.

Don’t Apply for Too Many Loans or Credit Cards at Once

When your credit is checked in order to apply for MaxLend loans or a new credit card, it is called a “hard inquiry.” Too many hard inquiries at one time may signal that you are in financial trouble, and your credit score could take a hit. If you need a loan, just apply to one place, or else batch up your inquiries into a short period. A batch of inquiries close together will only count as one inquiry.

Lower Your Credit Utilization Ratio

To have a good credit score, the credit bureaus don’t want to see you maxing out your credit cards. Try to keep the balances on your credit cards to under 30%. If you can pay your entire credit card balances every month, that is even better, but as long as you keep your credit utilization under 30%, you will be good. You can also change your ratio of utilization by increasing your credit limit, but this only works if you don’t start charging more and run up more of a balance. Be careful with this, because the increased credit will be very tempting.

Don’t Make Late Payments

Your payment history is the most important component of your credit score, so be sure to pay on time every month. Create a budget for yourself so that you will have the money to pay the credit card bill when it is due. Write down a list or make a spreadsheet with the due dates for each card so that you don’t miss a due date due to forgetfulness. This is the best thing you can do to improve your credit score.

Don’t Close Old Accounts

If you have old credit card accounts that you are not using anymore, don’t close them down. The age of your accounts is one factor that credit bureaus take into account when giving you a credit score. The older the average age of your accounts, the better.

Sign Up for Credit Monitoring

Keep tabs on your credit scores by signing up for a credit monitoring service. Some of these are free, and their apps can be downloaded to your phone. They will tell you your credit score, and some of them will tell you what you can do to increase it. Remember, though, that these services often get a commission when you open a new account they have recommended. Don’t necessarily take their advice unless you think about it first. However, it is useful to have a place to check your credit score for free to see how you are doing.

Follow these tips faithfully, and you will see an increase in your credit score. You will be well on your way to having excellent credit and a great financial profile.