7 Ways to Improve Your Credit Score
Los Angeles Poor & Bad Credit Car Dealership
Buying an asset like a car can be nothing short of a challenge. The challenge becomes even tougher for anyone who has limited resources or poor credit. Fortunately, there are simple measures that you can use to improve your credit scores.
1. Remove credit card balances
If you use many credit cards which have a lot of small balances, you may actually be hurting yourself in the long-run. You should pay off residual balances on your multiple credit cards as soon as you can. These balances hurt your credit score. Your score takes into account the number of active credit cards you have. It is better to use 2 credit cards as your “go-to” cards, preferably using those that have a good interest rate.
2. Time your purchases effectively
For larger loans — like mortgages, auto loans and even student loans — it’s commonplace to make multiple inquiries and applications before selecting one. Some newer forms of credit scores disregard multiple inquiries a number of days before scoring, anywhere from 45 to 14 days (depending on the score service being used) before your score is calculated.
Make sure you know when you need to make multiple inquiries so that they count as one. This means your score would not be hurt as badly if multiple inquiries count as one. A calendar should come in handy for this to know when your score will be calculated.
3. Play it safe
Paying less or not at all or spending more than your budgeted amount for the shopping period can indicate to credit companies that you may be under financial stress, although you may not be. Going off the reservation, spending more, or taking cash advances may raise alarms for some issuers, so be careful and play it safe.
4. Watch your balance and don’t go over
A rule of thumb with credit cards is to have your actual credit hover around 30% of your revolving credit (the total credit you have available). Pay down excess balances and keep them low. If you have a situation similar to that in one, you can use a personal loan in consolidating those payments, to get them all under one banner.
Some credit card issuers report your statement balances to the bureau so you might have a higher utilization ratio. A good way to safeguard against this is to ask whether the issuer of the card accepts multiple payments throughout the month.
5. Something is better than nothing on your report
Having some history of credit is better than having none at all. This means that for the mortgage you just paid off, you don’t need to have it removed immediately. When you get something removed from your credit history, the good as well as the bad are removed. The bad will automatically disappear after 7 years. Don’t let the on-time payments you made suffer because of it.
6. Relax
Don’t obsess over your credit report. If you’re making a big purchase in the near future, such as financing a car, make sure you know your credit score a bit in advance. A few months ought to do it. Other than that, don’t obsess. You can get three credit reports for free every year by each of the following: Experian, Equifax and Trans Union. One credit report, every 4 months from each one, and you’ll be monitoring your credit, practically for free.
7. Make it a habit for utility payments to go out on time
Utilities are something you should never take lightly. Pay them on time as they are recurring payments and will indicate to your credit issuer that you are in deep trouble because you aren’t paying your monthly balances. Not paying utilities on time hurts your credit score as this goes into your report.
Hawthorne Auto Square is designed to help those with poor or no credit get the car they’re looking for. Buy here, pay here: give us a call at (866) 707-7664 or stop by 11646 Prairie Avenue, Hawthorne, CA 90250 today!
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