If you’re having a difficult time getting approved for credit because you have a low credit score, working to improve your credit score can seem like a task that can take years to solve.
There are few quick shortcuts to improving a credit score, but there are some big moves that can raise it dramatically.
Here are some of the biggest moves you can make to improve your credit score:
Know your credit score
Start by checking your credit score at AnnualCreditReport.com for free. The three credit reporting companies must give you a free report once a year, so you can either get all three at once or spread them out by getting one every four months.
The score you receive represents your credit risk at a point and is meant to measure your future credit risk. Scores from the Fair Isaac Corporation, or FICO, are most widely used, with scores ranging from a low of 300 to a high of 850.
The higher the score you have, the more likely you are to be approved for credit and get the best loan rates for auto loans, home loan and credit cards, among other things.
Here’s a breakdown of what the scores generally mean: ...continue reading
If you’ve got a good or excellent credit score and pay your bills on time and keep your credit balances low, then maintaining that score can seem like a headache.
A credit score can be used in ways other than in determining what interest rate you’ll pay on a loan. It can also be used by employers, landlords and utility companies — with your permission — to determine if you should work, live or be allowed to sign up for electric service without a deposit.
Small credit score drop is fine
But not all of those look at your credit score as much as you might think. There are some times when it can be OK to let your credit score drop by a few points.
For example, if you don’t plan on applying for credit in the next six months or so because you’ve already got a car and house, then a small drop in your credit score shouldn’t hurt you. You still want to keep your credit in good standing, but there is some wiggle room.
Your credit history can be more important in non-lending situations than your credit score. ...continue reading
Our credit score determines a lot of things we are able to do with in our financial lives.
Without a good credit score, we might have problems getting credit cards, get a decent deal on our auto loan and so on.
A good credit score enables us to get a decent mortgage so we can buy a house for ourselves and our families.
But, what if our credit score simply is not good enough to get a deal that is acceptable for our current financial situation?
Credit scores can mean the difference between a mortgage and down payment that we pay with ease, and one we’re going to struggle with.
Financial decisions are the cornerstone of our modern lives. Not handling our finances, the proper way, may cause our credit score (and thus our credit worthiness) to crumble.
This is a vicious circle and we should avoid bad financial decisions not only when considering to buy a house, but every time we use our credit card.
Because this is a very important topic for many of us, we want to break the whole credit score thing down to some basic elements in order to give you a glimpse at what it means to have a “good enough” credit score to buy a house.