How To Improve Your Credit Score: The Basics

April 26, 2018 Off By Jess

How To Improve Your Credit Score

This is a collaborative post and may contain affiliate links.

It can be easy to see borrowing money as a good idea when you need it. Whether it’s getting credit cards or a loan to pay for a new car, the reality is that it can have a negative impact down the road. If you’re not responsible when it comes to making the payments, it can negatively affect your credit score.

Your Credit Score

If you aren’t careful, you can ruin your credit score and feel the effects of it well into your future. A poor credit score can affect your ability to buy or rent a home, get a necessary loan, or even get certain jobs. It’s important that you start the process of repairing your credit score if it’s not good. Here are a few guidelines you can follow to get started!

Find Out What Your Score Is

To find out what your score is and what’s affecting it, you need to get your credit report. Your credit report will list the details of any accounts you’ve opened, the balance of those accounts, what you have in collections, and more. There are various ways you can get your credit report. Credit reference agencies like Experian, Equifax, and Transunion can be great places to get started. 

I personally love the Credit Karma app for iPhone. I get a free credit report once a week and it gives me all of the updates I need to keep track of everything.

Once you have your report, make sure that all of your details are correct. It’s always a good idea to make sure that creditors haven’t reported anything incorrectly. Once you’ve reviewed it, make a list of all of your debts that are having a negative impact on your score. This will be the list that you should be focusing all of your attention on.

Fix Late Payments

The next step is to start getting back on track. Make sure that you aren’t missing any payments on your current debts. Consider getting in touch with lenders and ask them to forgive any late payments that are affecting your score. Some will be willing to help, and others may not be, but it’s always worth asking.

Default payments are payments that you’ve missed for three or more months. They will stay on your report for six years, but they aren’t necessarily a complete disaster. You’ll need to start building up your report again, but you can definitely improve your credit score while having default payments on your report.

Build Up Your Credit Score

If you’ve never borrowed before and don’t have a credit history, then you need to borrow money to build a credit score. Additionally, if you have a bad credit score after catching up on all of your payments, it can be helpful to borrow again. A lot of people will feel worried about this but as long as you’re sensible about it, it should be helpful. There are even credit rebuilding cards available on the market, which can be used to repair and restore past issues. 

Advice For Credit Rebuilding Cards

If you do need to get a credit card to rebuild your credit score, make sure to get a secured card. You’ll have to consistently pay it off in full every month. If that makes you nervous, set up one of your monthly expenses to be paid with that card. Pay that monthly expense via the credit card every month and immediately pay it off. Expenses like Netflix are perfect for this because it’s a small amount that you know you’ll be able to pay off every month.

The Benefits

If you have a bad credit score, it’s worth trying to improve it for so many reasons. Not only will you be able to get a mortgage and find it easier to get things like a cell phone, but you will also find that borrowing is much cheaper in the future. Good credit scores will save you money by getting you lower interest rates.

What methods did you use to repair your credit score? Share in the comments!

Loved this post? Read 3 Reasons Why Your Credit Score Is Poor

Disclosure: This is a collaborative post, which means that I may have received compensation in exchange for sharing links within this post. Additionally, this post may contain affiliate links, which means that I may receive a commission if you click a link and purchase something that I have recommended, at no additional cost to you. I value your trust and only recommend brands and products that I truly love! Read my full disclosure policy here.

How To Improve Your Credit Score: The Basics
The Basics Of How To Increase Your Credit Score