Best Ways To Repair Your Credit Score

If you are trying to improve your credit score, it can sometimes seem like an impossible task. If you have a long history of poor credit then it may be difficult to improve your score, but thankfully there are some simple tips that may be able to help you. 

Here are some of the best tips that you should follow if you are trying to repair your credit. 

 

Lower your credit card utilization rate 

If you want to improve your credit score you will need to make sure you learn about something called credit card utilization rate. Your credit card utilization rate is a metric used by credit because to help determine what your credit card score is. It is calculated by dividing the current amount of outstanding credit card debt by the total amount of credit available to you. Generally, the lower your credit card utilization rate the better as it will show lenders that you are responsible enough to handle having a large amount of credit available to you at any given time. If you want to improve your credit score you will want to make sure that your rate is low and this can be achieved by charging less to your credit card and paying off your balance regularly before your payment is due. If you can do this you will help improve your credit score. 

 

Catch up on late payments 

One of the most common reasons why your credit card score will remain low is due to having outstanding credit card payments. If you want to increase your score you will have to reduce the amount of your outstanding credit balance, A good way to do this is by using your credit card less, and making sure to put extra payments on your card so that you can eliminate your outstanding balance and improve your score. 

Avoid hard credit checks 

One of the best ways to help repair your credit is by avoiding hard credit checks. If you are new to the world of credit cards, then you may be wondering what a hard credit check is. When you apply for a bank loan, mortgage, or new line of credit, the banks will perform something called a hard credit check. When they do this, they will pull a full credit report from various credit bureaus and they will detail your credit history. Lenders do this so that they can determine your creditworthiness and this will help them determine if they should loan you more money. The one thing that you want to remember is that these hard credit checks can also happen when you check your credit score and they can temporarily decrease your score. This is why if you are trying to find out what your score is you should try and use an application that only performs soft checks as this will not have a negative impact on your credit score. 

 

Credit repair companies 

If you have already tried all of these options and you have not noticed any charge to your credit score then you may want to consider reaching out to a company that specializes in credit repair. Often times it can be hard to repair your score if you have had a long history of late payments or significant debt. In these instances, you will want to use a company that has experience dealing with these types of situations because it will be the best bet when it comes to repairing your credit. One thing that you will want to remember when reaching out to a credit repair company is that there are many different companies out there and you will want to do your research so that you can hire the best one. The good thing is that generally these credit repair companies are affordable and they will normally see improvements in your score within a few months or even weeks. 

If you have a poor credit score it may affect your ability to get new credit cards or apply for a mortgage. If you are at the point in your life where you are looking to purchase a home it is very important to make sure that your credit score is in good standing so that you can get approved for a mortgage and take advantage of lower interest rates. When you are trying to repair your credit remember that there are many simple tricks that you can use to help repair your score. Also, if you have tried lowering your credit card utilization rate, catching up on late payments, and avoiding hard credit checks, and neither of those seems to have worked, make sure you speak to a credit repair company. 

 

The views expressed in this article are those of the authors and do not necessarily reflect the views or policies of The World Financial Review.