I am always nervous when it comes to my credit rating. I have this insane fear that I will have something on my record that isn’t mine or is incorrect and it will make a right hassle to get it sorted. Luckily so far my fears are unfounded but I did come into trouble when I changed my name, something I hadn’t even considered would be a problem. Here are 5 ways to increase your credit rating, whether it is because of a bad credit history or no credit history at all.
1. Write to the credit history companies when you get married.
Such as Experian etc. Inform them that you have changed your name and if you wait patiently they will merge your old name’s history to your new name. I got stung by this when I was applying for a new current account just after I got married, they declined me because I had no credit rating and unfortunately wouldn’t reprocess my application with my old name considered. I have heard from banking friends since then that they really should have done, but it’s better to get everything put together regardless, as those years of responsible lending will disappear as soon as you say “I do”.
2. If you have a credit card, don’t max it out.
I know this is a pretty well-known one, but I am going to add a bit more meat to the bones of this recommendation. It is two-fold, don’t keep raising your credit limit as it looks like you can’t manage your money and are searching for more credit, and try and pay it off each month. Missing even one minimum repayment will severely damage your credit rating, so set a regular direct debit for the minimum amount. Try and pay more than the minimum each month, it shows you are making real effort at paying off the outstanding balance, even if you aren’t paying it in full.
3. Check more than one credit rating company
There are many out there and you don’t just have one single credit score. Each one is slightly different so make sure you do you research if you are getting ready to apply for finance.
4. Don’t shop around for loans.
Ok, so that is a little ambiguous, I’m not saying you should apply for the first one you see, but I am saying you shouldn’t apply for lots. Places like MoneySavingExpert have a loan approval calculator which takes into account your income so that you can find out without applying for a loan whether you’re likely to be approved.
Every time you officially apply for a loan it is stamped on your record so don’t keep applying to find the best APR. The calculators are really accurate as to whether you’ll be approved so make sure you check these out before you press apply.
5. Quick money needs quick repayment.
We all get stuck sometimes, whether it’s the washing machine that breaks or an unexpected bill, sometimes it’s undeniable that we need cash fast. There are plenty of places to get quick loans, but to prevent the sting of the high APRs and a knock to your credit rating you MUST remember to repay them straight away. They serve a purpose to help in a time of need, but don’t let the interest build and become unmanageable, make it your first priority to repay.
Do you have any tips to boost your credit score?
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