8 Ways to Build a Killer Credit Score

It’s not just when you are applying for a loan or credit card that you need an impressive credit history. Good credit rating is also an advantage if you are a tenant trying to find a new home, if you are looking for employment or when getting an insurance policy.

This article focuses on eight ways on how you can build a killer credit score that will surely win your lender, landlord, employer and insurer’s approval.

Examine your credit report. When was the last time you checked your report? Errors can pull down your score if you do not dispute about them right away. Do you have unpaid balances? What about late payments? Do you exceed or maximize your credit limit? Personally checking your credit report will help you see the real status of your accounts.

Open a savings account. Although a savings account is not included in your credit report, lenders will often require you to have one especially if you do not have credit history. A checking or savings account in your name shows that you are a person worthy of credit.

Pay your bills on time all the time. This is still the number one rule for building and maintaining a good credit score. Lenders love customers who are conscious of their payment obligations. They often reserve their best deals to customers with admirable payment history.

Do not maximize your credit limit. This means using more than half of your credit line most of the time. Lenders will see you as a high risk customer if you’re in the habit of maximizing your credit.

Pay your credit card balance in full each month. Many cardholders choose to carry over their balances from one month to the next. Even if they can pay of their full balance, they choose to submit only the minimum required due. Such a habit puts you at risk of bad debt because of the additional high rates of interest.

Get a secured credit card. If your credit score needs improvement, a secured credit card is a great tool for you. Choose a secured card issuer that will report your payments to the three major credit bureaus to update your credit status one payment at a time.

Pay all your creditors on time. Some lenders apply the universal default clause which means other creditors can increase their rates if you missed a single payment on one of your accounts. Although most credit card issuers today do not impose the Universal Default Clause anymore, you still need to conscious about your obligations, not just to one creditor but to all.

Don’t borrow more than what you can afford to pay back. If you’re not sure whether or not you can pay the purchase in full, do not charge it to your credit card. Wait a few more weeks until you save enough money and pay it in cash.

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