Your credit score can affect your life in ways you may have never imagined. This is not only important when applying for a loan. It can affect your future housing, as lenders and landlords check your credit score before giving you access to mortgages and rental homes. Some employers also check your credit score when you apply.
There are many reasons everyone should try hard to improve their credit score. This is not only so that you can get your dream home, a nice paying job, or the car you’ve always wanted to buy. A good score also allows you to get approved for a signature loan in Wichita Falls in case you need funds to cover for emergency expenses. But how can you improve your credit score? You can start by avoiding the following at all costs:
Late or missed payments
One sure thing that can hurt your credit score is the failure to pay your dues on time. Late bill payments and even missed payments will reflect in your credit history. Take note that up to 35% of your score is your payment history. So make sure that you pay your bills on time; never miss any due dates.
Canceling your cards
Think paying off your cards and canceling them can instantly improve your credit score? Then think again. One major mistake that can hurt your credit score is canceling a credit card. Doing so can affect the length of your credit history. This also lowers your total credit amount, which, in turn, increases your credit utilization rate.
Not checking for credit report errors
A study claims that one out of five consumers have errors in their credit reports. This results in said consumers having less favorable loan terms. If you don’t think about checking your report, you may already have errors without even knowing it. So make sure to regularly check your credit report for any errors. This can be done at least once every year.
Not paying your dues for 90 days or more
There are times when you fail to pay your debt for a long time. When creditors fail to receive your payments for several months, they will consider the debt as uncollectible. This can hit your credit score hard, and the collection company will bug you after gaining the right to collect your debt.
Agreeing to be someone else’s cosigner
Did a family or friend ask you to be a cosigner for a loan? While this can be a good thing, as you’re helping your loved one get approved for their loan, this can also hurt your credit if they fail to pay off the loan. When someone becomes a cosigner, they’re legally agreeing to having a credit obligation in case the borrower fails to make payments. The account you agree to take part in will show up in your report. If they are a good payer, this can increase your score, but if not, they will only do more damage than good.
Improving your credit score is not easy but is never impossible. With a little bit of hard work, you can boost your score, but it will still take a little time. Don’t let a poor credit score ruin your life. Start making adjustments, and you can achieve a better score that will benefit you in the long run.