I have had many people tell me that their credit issues were not their fault. They fell behind because of something someone else did or that they didn’t get the bills when they were sent. It doesn’t matter the reason, the bottom line is you have total control of your own credit score despite what excuses you might tell yourself. It doesn’t matter what happened in the past, maybe your credit history has been bumpy or you have run into issues due to COVID, you can be assured that there are steps you can take to increase your score but don’t believe it will be an overnight thing, credit repair takes time. By improving your credit, it will show lenders that you are a good risk and worthy of their best rates.
Here are a five important tips to helping you boost your credit score:
- Never let a bill get past due. This is the single biggest factor in your credit score: paying your bills on time. Set up automatic payments if you can or keep a careful calendar. Take this tip seriously.
- Create your own credit limits. If the credit card company gives you a credit limit of $10,000, create your own limit of $3,000: or no more than 30% of the available funds. Have more than one credit facility? Balance them out. It’s better to be at 30% on three cards than have one at the limit and two that are never used. You want to show that you are using your credit but using it wisely.
If you are getting too close to your limit, pay more than the minimum every month and, if you can, work towards clearing off your balance entirely.
- Maintain your credit history. You may have a low score because you do not have a record of owing money and paying it back. Sometimes, having no credit can be more detrimental than having bad credit. Since history is important, you don’t want to cancel a card and lose that history. The longer you’ve had a card, the clearer the picture is of how you manage your debt.
- Never ever let a bill go to collections. This can be a tough one if you’re short of money or a bill is under dispute. But a bill that is sent to collections is – next to bankruptcy – one of the blackest marks on your good credit name. If you’re having trouble paying, talk to the creditor about a negotiated payment plan – work with them to avoid falling into collections.
- Be selective. Applying too frequently for credit has a negative impact on your score. Lots of credit inquiries and credit cards looks like you’re an out-of-control spender and not a good credit risk. Don’t get caught up in the incentives that come with getting a new credit card, they usually aren’t worth the credit inquiry or risk. Just say no.
If you have fallen into credit issues and want to purchase, Rent to Own is a great way to do that. Get into the market today, build equity, control your stability and get the time you need to improve your credit. Our Rent to Own program is very flexible, just contact us to find out how it can help you get on the path to homeownership.