Having a great credit score attracts many interesting benefits and perks while eliminating hardship and financial constraints which is why it is absolutely imperative to endeavour to build your credit score and make conscious efforts to ensure it stays that way. A great credit score would enhance your entire financial outlook while repositioning you to enjoy many perks such as increasing your chances of getting a credit card and loan approval, lowers your interest rates on loans, and many more. Having a great credit score would certainly relieve you of financial stress and tension while enabling you to pursue your goals, pleasures and diversions. On the other hand, having poor credit score would attract significant levels of hardship which would be further exacerbated by higher interest rates and in worse scenarios deprivation of access to credit altogether.
While having a good credit score is largely your responsibility, most people who suffer from poor credit scores are often times completely oblivious of the necessary steps to take to rejuvenate their credit score. The same is obtainable with individuals who currently have great credit scores but struggle to maintain it. In a just concluded FTC investigation of credit reporting business, it was uncovered that there is an alarming pervasiveness of errors and inconsistencies of credit report with some of such cases resulting in increased interest rates on loans and increased premium on insurance.
Given the aforesaid it becomes absolutely clear the tremendous importance of monitoring credit reports for any form of error as it is one way to maintain good credit score. People often pay higher interests over extended periods that accrue to considerable amount of money owing to errors in credit reporting. Through the course of this exposition, you would be introduced to lawful ways to upgrade your credit report as well as a comprehensive guide towards enhancing and maintain great credit scores.
Always take advantage of free reporting from credit bureaus: when it comes to tackling bad credit scores, one of the most important actions to take would be to always request for your free credit reports on all of your credit scores from Equifax, TransUnion, and Experian. Free credit report is always made available annually and would be provided on request form any or all of the aforementioned bureaus. In addition, you can also request for a credit history which would give you a detailed insight into previous reports.
Examine the reports for consistency and correctness: It is imperative that you scrutinize the reports to ensure that there are no inconsistencies or errors and that all information contained is correct. Credit report contains very many important details which could enhance or degrade your credit score. When you remove a negative information, you would be surprised with how beneficial that would be to your credit score, which is why you must scrutinize the report for any positive information that was omitted a well as any negative information that was included as this could help to enhance your credit score ratings.
List of things to scrutinize on your credit report: Scrutinizing your credit report to ensure accuracy and consistency is imperative when trying to enhance your credit score. While there are plenty of information on a credit report which may make checking seem cumbersome, here is a list of the important areas you should focus on when reviewing your credit report that would help simplify the entire process with ensuring a heightened level of efficiency:
- Erroneous figure on amount of debt: when there is a wrong amount on the debt owed you can be sure that it would have an impact on your total credit score ratings as it would affect the assessment of your utility and credit usage. High utilization has a bad effect on your credit score.
- Accounts are not yours: there are instances where you cannot pinpoint when and where a debt was incurred and yet it reflects on the report. You should always disagree with any debt that you cannot remember as it could be a mistake.
- Erroneous delinquencies: there are instances where report contains erroneous claims of late payment and many other reprehensible financial patterns that can really affect credit score rating. This should be refuted vehemently in other to prevent damage to credit score rating.
- Erroneous reporting of collections accounts: it is quite common to find that collection companies would incorporate information on the report that is intended to siphon money of unsuspecting individuals. This is why it is imperative to check and refute any wrong information.
- Replicated collections accounts: this is an error that can induce serious financial burden on the affected individual which is why it is important to check reports. Replicated collection accounts refer to when debt is listed twice or many times thereby demanding ridiculously higher payment than the actual figure. When errors of this proportion are identified, the replicated figures would have to be taken out.
- Erroneous concluding verdict: the concluding verdict on a credit report has a profound effect on the credit score with many other concomitant ramifications such as reducing the chances of getting loans and so on. It is important that any erroneous information incorporated into your report is sniffed out and disputed.
Disagreeing with errors and irregularities: this phase requires that you eliminate all of the inconsistencies and errors after they have been identified. Negative information would certainly have undesirable effects on your credit score which is why disputing erroneous irregularities is important and this can be done by disputing various undesirable claims with the credit bureau. The dispute process is very straightforward and simply required validation from a company, individual or entity that listed the item on your report to show that the information is correct. The same is applicable to collection accounts as validation to the authenticity of listed item must be offered inside a 30 day period after dispute is issued to the bureau. Failure to offer validation of debt in writing would result in the item being eliminated for the credit report. In cases where the item is still not removed then it would be taken up by the credit reporting agency. Dispute can be initiated via letters, and emails, which would prompt the reporting agency to endorse the debt or eliminate it. Eliminating negative items would certainly enhance your credit score.
Timely payment of bills: prompt payment is one way to boost your credit score report. Also, having a commendable payment history contributes significantly to the entire outlook of your credit score which is why you should pay promptly and consistently. While some creditors do not include a report of prompt payments, it is important to note that ever credit card companies and mortgage creditors usually report it. In most cases, when payment is delayed for more than 30 days creditors would file a report to the bureaus. When payments are delayed for extended periods, you can be sure that is detrimental to your credit score as your debts would be traded to a collection agency to enforce. It is imperative that you endeavour to avoid deplorable situations like this.
Automatic payment is an effective way to reposition yourself to overcome the challenge as it facilitates consistent and regular payments. There are a few options available to someone looking to utilize this opportunity as you can make payments via banks or by using a personal creditor. Automatic payment completely alleviates the stress of having to managing monthly payments yourself one there is money in the bank, you can be sure that the payments would be dispensed as promptly and regular as possible, which would trigger a progressive credit scores climb?
Settle your debt: settling your debt is a fundamental requirement for getting good credit score ratings. However, there are a variety of approaches to handling debt settlement as one could have revolving debt or instalment debt. Instalment debt does not have as much damaging effect as revolving debt has on credit score. Instalment debt usually has an agreed payment plan which comes up monthly. On the other hand, revolving payment is focused on credit cards and is not regulated as you can incur more debts and pay as you desire. Revolving debt has a profoundly harmful effect on your credit score because unlike the latter it cannot be connected with any purchases or endeavours like a car purchase, tuition payment and so on. Against this backdrop, it becomes particularly advantageous and helpful to your credit score that your revolving debt is the foremost debt you handle before embarking on the settlement of instalment debts.
Now that you know to handle your revolving debts first, the next phase would entail knowing how to handle payments. The secret is to make certain that you none of your card is used up completely and if that seems to be imminent then you scatter your balance over many cards as opposed to putting all your balance in one card. Also, keeping the utilization rate on your credit card as low as 35% would help you manage your revolving debt better.
Avoid profligate use of credit: wasteful and profligate spending especially on your credit card can land you in a precarious debt situation. Once you have begun a steady ascendancy out of debt, particularly revolving debt, you must make an effort to use your credit card shrewdly. Contrary to misconceptions, using credit card is very beneficial and can help you create a solid reputation for prompt payment which is a perquisite for a remarkable credit history. For individuals who do not require a credit card, you can still make bills with it and then pay promptly to create a formidable credit history.
For people that are encumbered from obtaining credit cards owing to the deplorable state of their credit history, you can overcome this by getting a secured card and depositing some money in it and keeping the deposit that way by paying with money from other sources leaving the money as a security deposit. This would help improve your credit score and the money would be made available once you make a transition to the conventional card.
Encourage formidable accounts: when keep a progressive account open for a protracted period you can be sure that your credit score rating would go up dramatically and your credit history would be formidable. To achieve this, you would have to keep an open account for a long period of time and make sure that the account balance is always commendable with habitual timely payment. This would automatically give you a laudable credit history. On the other hand, having a bad payment history would be damaging to your credit score. This can further engender fears of you running up cost on the card and not making payments.
Cutback on credit inquiries: when you make inquiries about the state of your credit too often, it could impact adversely on your credit score. Inquiry occurs when you keep applying for credit cards and loans too often as these triggers a query into your credit report. The query culminates into points that would be subtracted from your yearly score. However, this does not apply to a request for the same type of credit as this is regarded as the same inquiry. While it is completely understandable and acceptable that you want to compare offers before borrowing, applying for fresh credit on a monthly basis would provoke concern. Applying for credit has to be done tactically without being too conspicuous. Most times, requesting for credit when it is genuinely needed is best.
Enhancing credit score with a Trustworthy Credit Repair Services
If you are looking for a stress free way to enhance your credit score then a credit repair company is the best option for you. While it may take time to upgrade your FICO score, you can be sure that you would be relieved of all of the complications while you experience a consistent climb towards a laudable credit score. These companies offer unwavering support in all areas leaving just a few negligible aspects to you. Credit companies would undertake all of the difficult areas and processes which encompasses following up on confirmation letters, dispute notices, while monitoring deadlines.
Undoubtedly, having great credit score is a perquisite to improved living as it enhances your opportunities while mitigating hardship caused by monetary constraints. When you follow the aforementioned guidelines doggedly, you can expect that having great credit score would become a lifestyle. However, if you require the help of expert companies and reputable individuals to facilitate your credit score recovery or management, then you can examine the review section for additional details.