Having bad credit can hurt your finances and make it harder to get loans. A bad credit score can happen to anyone for a variety of reasons, like not paying off debts or bills on time. There are ways to improve your credit score, which is good news.
- Don't pay late.
This is by far the most obvious way to improve your credit score, but it's still worth mentioning. Whether you're a few weeks or a few months late, your credit score will go down if you don't pay your bills on time.
- Get out of debt
This is hard because you want to pay off almost all of your debts, but not all of them. Your credit score shows how well you handle your debt, but if you pay off all of your debt, you no longer have credit. The best way to handle this is to pay off most of your debt, but keep a small amount to deal with.
- Several different credit cards
Like paying off your debt, showing that you can handle different kinds of credit cards shows that you can handle money. This doesn't mean you should have 10 different credit cards, but having a few different kinds will help your credit score. You can show that you can handle both short-term and long-term credit cards if you have a Visa, MasterCard, Sears, and/or gas card.
- No new loans
If you don't have to, you should avoid getting any kind of new credit. When you apply for new credit, an inquiry is added to your credit report, which lowers your score in some way.
- Don't go bankrupt or lose your home.
Because they stay on your credit report for 10 years, filing for either of these can kill your credit score. Not only that, but over time they also hurt your credit score. The good news is that the 10 years has less of an effect on your credit score the closer you get to the end.
- Delete errors in 48 hours
This is the fastest and best way to fix any mistakes on your credit report and raise your credit score. To do this, you have to fill out a lot of paperwork, but it will save you from having to deal with much more later.
No matter what you decide to do to improve your credit score, you should start as soon as possible. Having a bad credit score can ruin your finances and make it hard for you to get any kind of loan in the future.
