Finance

How To Clean Up A Credit Score

Even if you don’t have any big purchases on the horizon, you need to be cleaning up your credit report regularly. Your credit history is the foundation for your personal finances, and this isn’t going to change! Whenever you need to take out a loan, apply for another credit card or buy something on finance, it will be there hanging over your head. If your credit report isn’t looking too great, here’s how you can clean it up.

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Credit: The Blue Diamond Gallery

Seen as you’re reading this, you may be a little confused about credit reports in general. First of all, you need to understand the factors that affect your credit score. When you avoid certain black marks, your report will be in a much better condition. High levels of debt are one of the big things to be wary of. If you’re already pushing your luck, banks and credit card companies will be pretty hesitant to lend you more money. Of course, when it comes to secured homeowner loans your collateral might be able to tip the balance. Missed payments on past loans are another common reason for a poor credit score. Business owners should also be aware that credit scores are cross checked, services like http://bestbusiness.creditcard/ will scan over the best business credit cards, be be sure to expect a credit rating check. If you are a director of a company that is heavily in debt, this can certainly make your chances of securing a good credit rating difficult. These causes are just the tip of the iceberg. However, it should give you an idea of the bad habits that could bring down your score.

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Credit: Flickr

Your next step should be checking your report for mistakes, and having them fixed. Agencies have to process countless credit reports. More often than you’d expect, they screw up and leave certain inaccuracies, which can bring down a person’s score. Go through your score meticulously, checking for anything that I mentioned before and other blemishes. If you’re certain they’re inaccurate, call the agency who supplied your report and tell them about it. From then, they’ll have 28 days to fix the error, or get back to you if they think it’s all correct. In some cases, it may be worth contacting the lender involved in an inaccuracy too. Agencies have to talk to them to resolve disputes, and they’re usually in a good position to resolve inaccuracies. There may be other things which are accurate, but paint an inaccurate picture of your current situation. In this case, you can add a “notice of correction” yourself. This is a statement of 200 words; use them wisely!

From then, all your work is going to be keeping your credit score squeaky clean. Make sure you pay all your debts on time, and avoid applying for more credit if possible. If you’ve got any credit cards with a low amount of debt, then make paying them off a priority. Worse still, you may have cards which you simply don’t use. These aren’t much other than bits of plastic you carry around with you. Cancel them so that they’re not a target for frauds! Generally being more involved in your own finances will keep your credit score nice and high. All it takes is some belt-tightening, and a little self-control.

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