How to Improve Credit Score: Three Easy Ways

May 4, 2012 · Posted in Finance · Comment 

How to improve credit score without resorting to hiring professional companies is doable. Yes, you can take matters in your own hands and do something to change your bad into good credit. In fact, there are three easy steps you can take which are effective in improving your credit score. Well, why do you need to improve your credit score, in the first place? Basically, the idea is to make sure that you have a good standing with the lenders so that anytime you need a loan, you apply for one and get it. It?s as simple as that. Plus, a good credit score translates to a comfortable life.

In the country, bad credit is common. Now, even if it is, it does not mean that you have to join the bandwagon. Don?t opt to join the bad creditors who have a hard time making ends meet each month. Instead, choose to join the ?winners? who know what to do with their finances and who have good credit scores. Joining their side is the best decision you will ever make.

So, if you have bad credit, you can do well by following certain steps in order to set your credit score right again. Here are the tips you can use. First, apply to get a secured credit card. Yes, contrary to what it implies, applying for a credit card works to your advantage in this case. How? The fixed deposit you are supposed to make with your chosen bank will pay for whatever charges you make on the card.

On the other hand, a secure credit card requires that you keep a fixed deposit with the said bank. This implies to the lenders that you are in a fit financial state which makes you appealing to them. Additionally, you can apply for a home loan or an auto loan in the future.

Number two: Apply for small loans with co-signers. You ask again: What? I can improve my score by making more loans? You bet you can! The small loans, made with the help of co-signers even when you have bad credit, is good for convincing lenders that you are ready to make bigger loans. It?s as simple as that! You just have to convince a friend, neighbor, or relative, with good credit, to be your co-borrower.

But then again, you have to guarantee that you pay off your loan each month so that your co-signers (and the lender) won’t run after you to get the money you owe! Thus, make sure that you religiously pay off whatever loans you make. This is perfect in enhancing your reputation with lenders. Additionally, when you do that, you get to keep your friends whom you will otherwise lose when you don’t pay the amounts that you owe and the lender runs after them!

Number three: Check your credit report once every year. This is also needed when you want to improve your credit score. Frequently, bad credit stems from erroneous entries in people?s credit reports. This means that you could probably be suffering from bad credit scores due to omissions or errors in your report. Therefore, be quick to spot any wrong entries or entries not included on your report to credit bureaus in the area.

These three useful tips of how to improve credit score can prove useful in changing your credit score without paying somebody to get the job done for you.

The methods for how to improve credit score don’t need to be difficult. Just learn a few tricks and you will be on your way to improve credit score.