Thursday, April 16, 2009

Credit Score ; How to improve it ?

Credit score how to boost them up ?
Following are the ways in which you can improve your credit score

1) The most important thing to boost your credit score is to be punctual with your payments.

2) Review your credit report and rectify any errors you come across regularly. One error or discrepancy in your credit report could impact it negatively and has a possibility to ruin your credit history. So in order to boost your credit score, take conscious steps to monitor your credit report as frequently as possible.

3) You could also enroll with a credit monitoring service which automatically monitors your credit file every business day and alerts you of any untoward change on your credit file.

4) Close any accounts that you do not need or use. The benefit is that this reduces your amount of available credit and can help boost your credit score in the bargain.

5) Don’t let anyone make any inquiry on your credit report unless there is a total requirement for doing so. Increasing number of inquires on your credit report has an inbuilt tendency to ruin it.

6) Credit scores are dynamic. They are based on your current credit report which means that it changes every time your credit report changes. Although the change may be negligible, it could be much more glaring also. Boost your credit score by reducing the balance on credit cards to least amount of your available credit.

7) If ever a loan from a bank is denied because your credit score was low, you will be presented a list of reasons for that low score. You can review the reasons along with your credit report and take necessary steps to boost your credit score.

8) You can also turn your score upwards by taking alternative measures to make your credit card payments on time. There are alternatives like auto pay (direct debits), online payments or payment over the phone. Normally banks charge a certain fee for this service but the payment gets posted on the same day. This means that even if you make the payment on the due date, you can have the peace of mind that you have not gone past due. Conscious efforts on the part of the credit card holder to make the payments on time and consistently, is seen as an improvement. This surely will save you from succumbing to a default rate.

9) The notable thing is to get credit or ask for a credit line increase only when you need it. It is a different thing when you are trying to set up your first credit. Use your available credit line carefully and be regular with your payments.

10) The best thing is to keep on saving bit by bit every month and invest in Mutual funds or other appreciating assets rather then live on credit to credit and keep on paying interest.


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