Your credit score is usually a three digit number that indicates to lenders your ability to service a credit facility based on your track record with your finances. If your credit score is favourable then you will be offered the loan and at a favourable rate. If unfavourable you may be offered a higher rate of interest or refused the finance altogether.
It is estimated that 60% of the adult population have a good credit score. To achieve this pay your bills on time, including credits cards and other loans that you have had in the past. Doing so will avoid incurring any penalties that will be reflected in your credit report.
So how do those with low credit rating fall into the trap? Often they are unable to pay finance back and the amount owing continues to accumulate. This increases the amount of interest accruing.
Some people are late with their payments. Those who ignore calls or letters from the bank will have the payment marked as "unpaid." This information is posted on your credit report so that lenders, whom you might approach in the future will already be wary of giving you credit.
Good housekeeping is not enough to maintain a good credit record. You have to be seen to be reducing your liabilities in order for your rating to be favourable. It is also important to remain in close dialogue with your lenders.
Some people will borrow money from friends and relatives to reduce their debts. The only benefit from this is that they won't charge you any interest. You will still have to pay them otherwise you will lose the only people you can turn to if you have a problem.
You can improve your credit score only if you are able to monitor your expenses. One piece of advice that a lot of experts say is that if you have a credit card, you should only use up about 25% of the limit. To avoid interest, make sure that you pay the whole amount and not just the minimum if you can.
As your rating improves your bank may want to increase your credit. This is fine providing you do not deviate from your overall control of your finances.
Always check your credit rating once a year. It is not unknown for people to have mistakes lodged in their report that adveresly effect their rating. If you find any you have the right to report them immediately and have them removed. Your rating will improve following their removal.
Monitor your budget carefully to avoid overspending. Even if you have done well this year you need to keep up the good work and reduce those commitments. If you do not then you only have yourself to blame.
It is estimated that 60% of the adult population have a good credit score. To achieve this pay your bills on time, including credits cards and other loans that you have had in the past. Doing so will avoid incurring any penalties that will be reflected in your credit report.
So how do those with low credit rating fall into the trap? Often they are unable to pay finance back and the amount owing continues to accumulate. This increases the amount of interest accruing.
Some people are late with their payments. Those who ignore calls or letters from the bank will have the payment marked as "unpaid." This information is posted on your credit report so that lenders, whom you might approach in the future will already be wary of giving you credit.
Good housekeeping is not enough to maintain a good credit record. You have to be seen to be reducing your liabilities in order for your rating to be favourable. It is also important to remain in close dialogue with your lenders.
Some people will borrow money from friends and relatives to reduce their debts. The only benefit from this is that they won't charge you any interest. You will still have to pay them otherwise you will lose the only people you can turn to if you have a problem.
You can improve your credit score only if you are able to monitor your expenses. One piece of advice that a lot of experts say is that if you have a credit card, you should only use up about 25% of the limit. To avoid interest, make sure that you pay the whole amount and not just the minimum if you can.
As your rating improves your bank may want to increase your credit. This is fine providing you do not deviate from your overall control of your finances.
Always check your credit rating once a year. It is not unknown for people to have mistakes lodged in their report that adveresly effect their rating. If you find any you have the right to report them immediately and have them removed. Your rating will improve following their removal.
Monitor your budget carefully to avoid overspending. Even if you have done well this year you need to keep up the good work and reduce those commitments. If you do not then you only have yourself to blame.
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Learn more about credit. Stop by Phil Craven's site where you can find out all about personal loan and what it can do for you.
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