Having an excellent credit score can save you a lot of money in interest over time. If your free credit score is already in the 700s, you’re in good shape, but you may be wondering how to take your score from good to great. If your credit score is lower than what is asked by the financial institutions, there may be a quick way to bring it up. Depending on what is holding it down, you may be able to tack on as many as 100 points relatively quickly. Scores in the “fair” and “bad” areas, like something between 300-600, can actually drench you in a costly loan with hurdles and denials.
There are some amazing ways in which you can increase your credit score and improve it. An excellent credit score is above 750 and that leaves the ball in your court. Easy approvals, low rate of interest, free credit score check, a smooth process and minimal documentation are some of the perks that you can explore at the time of borrowing. If you need an excellent score, you need to work for it. Before we delve more into more information, here are some of the tips for getting an excellent credit score:
Tips to get an excellent credit score
Make payments on time
Payments heavily influence your credit score. To stay on top of your payments, set up a calendar reminder or enroll in automatic payments. It is important to be updated with payment without any delay or default. A missed or delayed payment is not a good idea. You need to be on time when you have taken up a loan and your EMI is pending every month. An excellent credit score is what you need, and for that, you need to have a clean track record. A missed payment will stay on your credit report and pull down your score. It takes a lot of time to eradicate the credit report entries, so before you miss a payment, ask yourself if you can afford it.
Restriction on new accounts
While you may need to open accounts to build your credit score, you generally want to limit how often you submit credit applications. Remember, for every new borrowing application, the loan providers will run a check on your credit report. Each application can lead to a hard inquiry, which will damage or hurt your credit score. Opening a new account is not a good sign of improvement. Do not open a new account.
Pay full amount
Credit cards play a vital role at the time of deciding your credit score. If you aim for a good credit score, you will need to pay the full amount. The minimum bill amount is not a good option to rely upon. If you pay the minimum amount, you end up making your bills more expensive. You can not keep behind an overdue or outstanding amount. When you pay an outstanding amount, you end up hurting your credit score. It is important for you to make a payment of the entire bill amount without any hesitation. It may become a burden initially, but in the long-run you will benefit both in terms of good credit and an affordable loan.
Let your credit age
An old credit account will always be the best way to increase your credit score. When you keep your credit accounts open, your credit age will increase. Even if you don’t use it, you should not close your credit account. Let the credit account stay open, and this will increase your score in turn. New accounts are not good for your credit score, and it is always better to avoid opening new credit accounts without any necessary need. Make sure you keep your credit cards open, even when you don’t use them, as that will increase your credit score without you even knowing it.
Maintain debt to income ratio
If you need a good credit score, you will have to maintain the right debt to income ratio. This ratio will be helpful in managing your credit score. When debt is below your income, and takes up less than 40% of your income, there will not be any risk. You should try and get the right ratio so that you get an excellent credit score without any second thought. It will be helpful in dealing with the new financial opportunities in the years ahead.
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Keep a single credit card: Always limit your credit usage. Credit cards are great for emergencies, but you can not make it a habit. It will be an expensive one, and you must limit yourself in terms of credit usage. The rate of interest is high and the bills can become a burden on you.
Wrapping up
Keep yourself updated with a free credit score check. It will help you detect errors and make the necessary changes to improve your score. For a free credit score check, you can surely visit the Clix Capital website.
