What Is My Credit Score and Why Should I Care?
Posted at by ifydcat on category Credit
In this era of financial insecurity we should all know the answer to the question whats my credit score. You should check your file annually. But when you receive the result, what exactly does it mean?
If you are successful in getting what you want, the definition of your credit score must be positive. The highest score possible is the aim of this game. When deciding whether to grant you credit, a financial institution will review many things including your credit score. You should aim to have a score of over 720, more if possible.If your score is below 650, you need to work on improving it.Here are three ways to help you to raise the credit score result.
- Reduce your balance every month but do not pay it off in full.Repaying your debts should raise your score as you are less likely to default. You will show prospective lenders that you will make them some profits as you do not pay the full balance every month.Financial institutions like those clients who pay some of their bills but do not clear the account in full. The bank will make a profit by charging these people interest.
- Too many tries to get credit will send you score downwards. If a bank says no to extra borrowing, this can mean you lose 50 or more points off your credit score. You should only apply for credit that you actually need and are reasonably sure you will get. A free gift should not entice you to apply for extra borrowings.Do not be tempted by silly gifts offered to get you to complete credit application forms that can adversely affect your score. Your annual credit score should be closely checked for errors. If identified, these errors should be removed.
- Your score should increase once any errors have been removed or ammended.
Your score should be positively affected if you put these 3 tips to use. New borrowing facilities will be possible if you are eligible for cheaper interest rate deals. Be sure you can afford all new loan payments. Try to keep your credit score as high as possible to secure your family’s financial future.