Your credit score is one of the most important numbers, yet many people don’t pay attention to it until they learn they have been denied for financing. The best prep is always being aware of how your credit stands at all times.
Constantly monitoring your credit activity and keeping up with your financial obligations is very important.
But there are little things you can do that will have an almost immediate impact on your credit scores, increasing them and contributing to a more attractive credit profile that will lead you to more approvals and better (lower) interest rates.
Low credit scores can cause stress and make some financial situations much more difficult. But, we have some tips that can help. Sit back, relax, have a little hemp oil to calm down, and put the information below into action.
Pay Down Balances Under Seven Percent
One of the biggest contributors to your credit score is your debt to credit ratio. So, if you have $100,000 in available credit, but you have $90,000 charged on your credit cards it will lower your score because you have very little available.
You never know when an emergency will spring up. From a car repair to a sewer line repair, these type of emergencies never give you a warning. They just pop up and require immediate attention and money.
The magic number is below 7%. So, if you had $100,000 in available credit, you would want to keep your total reported balances below $7,000 to get the highest credit scores possible.
Paying down your cards to achieve that low utilization ratio will instantly increase your scores the next time they are generated.
Get Yourself Added to Aged Cards as an Authorized User
Being added to credit cards as an authorized user gives you the age and payment history of the particular card or cards you are added to. But remember, the entire history of the card is pulled, so you need to make sure it’s cards with perfect payment history and also large limits and low balances.
You want to make sure you only look for cards from family members or people you trust, as you will have to provide them with your social security number.
When you add a new card to your profile via an authorized user it will also directly impact your average age of accounts, so many sure any AU added has a long history. Look for cards with 15+ years for the biggest impact on your score.
Signup for Experian’s Credit Monitoring and Activate the Boost Feature
We all receive credit offers in the mail and via email all the time. There are credit card offers, free racing offers, and invitations to apply for auto loans and even home mortgages.
But anytime you apply for credit it will put a hard inquiry on your report and this lowers your score every time. Also, having a lot of inquiries can be a sign that you are in trouble and trying to secure as much credit as possible.
So, try not to apply to offers that you don’t need. Signing up for a credit monitoring service is smart and if you use Experian’s, you can activate their “Boost” and most consumers see an instant score increase of 15 points! This is helpful especially if you plan on applying for a home loan or auto loan soon. Or, if you’re considering downsizing, you can do so by taking Aviva equity release.