Want a Higher Credit Score? Here’s How to Get It

Do you wish your credit scores were higher? For the vast majority of working adults, the numerical scores reported by the three major bureaus have a massive impact on their lives.

Not only do your scores determine whether you can borrow, but they also have a direct effect on the interest rate you pay when you are approved for loans. For example, the difference between having a high and fair rating can mean paying thousands of dollars, more or less, for a new home. The same is true when you borrow to buy a car or other big-ticket items. Aside from the associated expenses of paying higher interest rates, employers often screen applicants by their scores.

What’s the solution? Upping your numbers on these all-important financial records begins with acquiring your own reports from all three bureaus. By law, you don’t have to pay for the service unless you make multiple requests within a year.

Borrowing wisely and repaying on time is the next step.

Taking out a personal loan from a private lender is another powerfully effective way to boost scores. After that, make an effort to pay all bills on time, keep credit usage low, and maintain a savings account for financial emergencies. With all that in mind, here’s how to get started:

Read Your Reports

If you’ve never seen a real credit report, the format can be quite confusing. Check out one of the many websites that help consumers interpret their reports. That way, you’ll know what you’re looking at. Make a note of your scores with each reporting agency and see how they have changed over time. Look for errors and be aware that you’ll need to contact the bureaus directly, preferably by phone, to discuss removing erroneous data.

Open a Savings Account

Opening a savings account won’t have an immediate effect on credit scoring, but it will do two very helpful things. First, you’ll develop the habit of setting money aside from each paycheck. Second, when you face a financial emergency, you won’t feel the need to borrow or use plastic if you have an emergency fund. And there are reasons to have an emergency fund that are less obvious than others, since what constitutes an emergency for one person may not be so for another.

Borrow Wisely and Responsibly

One of the most effective ways of boosting your scores is to take out a personal loan from a private lender to either consolidate high-interest credit cards or pay for a routine expense. By repaying the loan on time, you can directly affect your overall credit rating. Avoid pulling out the plastic to pay for new expenses. If you need money for a small home improvement, a family vacation, or a medical emergency, work with a private lender to apply for a personal loan. It’s a win-win situation because you help your credit scores by repaying on time. You also get access to flexible terms and competitive interest rates.

Pay Bills Early

Late payments are one of the most common reasons people have trouble getting loans. The reporting bureaus lower your scores for every missed payment. It sounds simplistic, but paying every bill early or on time is one of the fastest, most efficient ways to improve your financial situation and creditworthiness.

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