4 Ways To Improve Your Credit Score

Matt | Personal Finance

Are you looking to boost your credit rating and get closer to that perfect score?   In this Short, I share 4 actionable tips to help improve your credit score, making it easier to qualify for loans with better interest rates and terms.   Your credit score plays a major role in how lenders view you – they base interest rates on how risky they perceive you as a borrower. By improving your score, you can unlock the best possible terms for mortgages, loans, credit cards, and more.   #creditscore #credit #creditrating #creditcard #loans #mortgages #debt #debtfree

Transcript

00:00firstly try to make sure that you always pay your bills on time as it shows on your records and

00:05demonstrates that you're able to make payments when you're supposed to lenders will use this

00:10information to assess your reliability to make payments to them on loans missing payments having

00:16account center collections or filing bankruptcy could hurt your scores and having a late payment

00:21history can stay on your records for a number of years i know paying bills on time can be hard

00:27particularly with the recent high inflation and increases to living expenses a couple of tips for

00:32you one is to set up direct debits for a few days after payday so you have the money in your bank

00:38account for when the direct debits are being taken out for your regular monthly bills and if you do

00:43have any late payments speak to your lender or provider and agree the plan to settle the payments

00:48over a fixed time period so it doesn't show as late on your records anymore the second way to improve

00:54your credit score is to review your credit utilization this is the percentage of your

00:59overall available credit limit that you're using and the typical guidance is to keep this at or below

01:0520 to 30 percent so if your credit limit is 2 000 pounds per month that would mean spending no more

01:11than 400 to 600 pounds each month on credit to calculate this for your own personal circumstances take

01:18your total available credit per month and divide it by the amount you spend on credit each month

01:23if you're unable to reduce the amount of spend you make on credit then one way to improve your

01:28utilization score is to ask for a higher credit limit from your credit provider importantly you

01:34don't have to use it but it can help to reduce your percentage credit utilization third is the length

01:39of credit history that you have this includes the average age of all your credit accounts and the age

01:44of your oldest and newest accounts showing a good history over a long period of time with a bank

01:50shows stability that doesn't mean you can't look for the best bank account to move to but think

01:55about keeping a long-term account and then having another account which you switch to the best interest

02:00rate every so often that way you don't lose the stability of having an account over the long term

02:05the fourth point is to check your credit report for inconsistencies you can view your credit report with

02:10experian equifax and transunion ensure the history is accurate and consistent and shows things like

02:16the correct property addresses for the correct periods of your life and review the information

02:21and look for any mistakes or errors this is important because lenders will use this information

02:26to cross check to any application that you make for credit and if there are discrepancies in the

02:30information this can result in your application being declined reviewing your credit report can also in

02:37the worst case identify fraud if someone's taken out credit in your name without you knowing about it

02:43i had this a few years ago where a credit card had been taken out in my name by someone else and i work

02:48with the credit report agencies to correct this information and remove the incorrect credit card

02:53from my records the other thing to watch out for is linked accounts

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