How to Improve Your Credit Score and History

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When you apply for a loan, MONEY LENDERS will initially analyze your CREDIT score and history. This is because credit score will show your credit pattern with focusing on more recent credit transactions that you’ve made. There are actually several factors that affect your credit score and history and these are first, your diligence in paying your credit liabilities on time because delinquent payments can have a negative impact on your credit standing. Second, keeping low balances on credit card, revolving credits and other PERSONAL LOANS; Third, Not applying for new credit accounts and fourth paying off your debt instead of moving it around will raise the standing of your credit score.


Payment History


Reliability on paying your credit liability on time is an important factor in raising your credit score because paying your credit liabilities diligently shows that you are responsible in keeping your debt responsibilities at a very high standard. For money lenders, this is a good gauge to see whether you can be trusted to pay back on time the amount of money they’re going to lend you.


You’re Credit Utilization Ratio


Your Credit utilization ratio is another factor that any financial institution would look at. The ratio would normally be based on your credit card usage and this is done by dividing the total balance of your credit card against your total available credit limit. Lenders would like to see at least 30% or less result. If the result is way below the 30% limit then you can be considered as one with a very good credit standing which would be a plus for your loan application. Low credit utilization also shows that you are using your credit way below the maximum limit which is good because the less you use your credit card, the better. Two other factors that can also help lift up your credit standing are paying off your current debt to zero out or at least lower your credit card liabilities and second, is to become an authorized user of another individual’s credit account (as long the principal  user also uses his credit card  with diligence and responsibly).

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