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How I Became An Expert on Finances

Great Tips On How To Improve Individual’s Credit Score

In recent times, credit rating is one of the major factors considered when rating an individual at different circles. Credit score determines the credibility of a client in the eyes of potential lenders, employers and landlords and determine the risk involved in engaging the client. It is one of the major aspects put into consideration when loans, services or goods are offered on loan to the client. Ability of the client to access credit services from different sources and capacity to make repayment is the key aspect considered in rating the clients score. Ability to pay in time increases the score while failure works in the opposite direction.

Access to different credit products is the first step in building a good rating for the borrower. However there is need to ensure amounts borrowed are within individual means to ensure consistent and full repayment. While it is important to have access to credit facilities, not borrowing increases the rating with indication of a responsible borrower who only access in time of need and not because of availability of credit.

Fraud is common in financial deals. To avoid the disappointment that may arise from fraud, the borrower needs to keep checking their credit reports to ensure it is consistent with the amounts borrowed and repayments being made. Raising the issue with the lender is the best approach to deal with any case of fraud and this ensures it is sorted to reflect the agreement in place. This can be done by writing a credit dispute letter to the borrower and keeping record of the letter for future referrals.

Borrowers need to know and set the best times to apply for credit. While it is possible to access credit from different lenders, the borrowers need to consider the timings to ensure they do not overlap. The score is affected by numerous instances of hard enquiries made by the borrower to different lenders. Where it must be done, the borrower needs to use the soft enquiry approach that does not reflect on the score ratings.

To improve on the ratings, the borrower needs to make payments on time. This can be effecting through use of auto payment options or setting reminders to ensure you are well aware of the time to repay a loan or settle a bill.

While credit maybe accessible, it is not a platform to change individuals lifestyle. Borrowers need to borrow only that which is important. Maintaining borrowing blow the available credit limits is ideal to ensure there is ease of payment. This not only ensures there is adequate ability to repay but as well leaves room to access more for an emergency situation that may arise while the previous amounts are not fully cleared.

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