The better your credit score is, the additional likely you are to get a loan. However, if you don’t know what makes up your credit score or how to improve it, you’re out of luck when it’s time to apply for a mortgage or car loan. Luckily for you, that’s where this article comes in! They’ve compiled a list of tips that will help boost those numbers and get you closer to financial freedom. Credit building cards are also one great option.
Pay Your Bills on Time
Paying your bills on time is the crucial thing you can do to boost your credit score. When checking with the card issuer or bank that issued the card, you’re not sure about which bills to be paid.
If you want to improve your credit report and build up a long-term positive payment history, look for cards that offer rewards for paying bills on time. You’ll get some positive points for doing so, and hopefully, it will help increase your overall rating over time.
Get Your Free Credit Reports
One of the greatest important things that you can do to keep an eye on your credit score is to get a copy of all three of your credit reports. You can obtain one free copy each year from each of the three major reporting agencies: Experian, TransUnion and Equifax.
So make sure that you take benefit of this opportunity by requesting that they send you copies every four months throughout the year.
Reduce Your Credit Card Debt
- Pay off your high-interest credit cards first.
- If you have multiple high-interest credit cards, pay off the one with the highest APR first. A minor awareness rate will save you more money in the long run than a slightly larger balance on a card with a slightly lower rate.
- Consider transferring balances to lower-interest cards or consider closing accounts that are no longer useful for you.
According to Lantern by SoFi, “A credit card is issued by a lender. When you charge money on it, the lender pays the vendor and adds that amount to the balance you’re expected to pay back to the lender, when you get your monthly bill or over time, with interest.”
Dispute Errors on Your Credit Report
If you discovery an error on your credit report, there are a few steps you can take to get it corrected. First, contact the credit bureau and notify them of the incorrect information. They will then investigate and report back to you within 30 days. If they find that the information is inaccurate and needs to be removed from your file, this will be done automatically without any action from you.
However, suppose they do not agree with your dispute or cannot verify that it is wrong (for example, because of a lack of documentation). In that case, they will require additional proof before removing it from your record – usually in the form of IDs such as receipts or contracts showing payment history for services provided by other businesses where these records have been misreported on their own behalf as well.
Diversify Your Credit Mix
You can also diversify your credit mix by getting a secured credit card. These cards require a security deposit, which is used as collateral in case you default on your payments. You can use the money from this deposit to build up your credit score and increase its length of history, which will help boost your overall score over time.