In the last two posts, we’ve shown you how to easily view your report, and what to look out for when you do so. In this post, we’ll talk about the aftermath: how you can quickly, and easily, improve your credit report. Spoiler: it’s all about being responsible.
1. Keep up to date
Firstly, keeping up with your bills and payments is a must. The more you do, the better your rating shall be: you need plenty of evidence of that crucial sentence “in full, and on time”. It shows effective, responsible spending on a monthly basis, and shows that you are in charge of your finances.
2. Don’t make too many applications
Lenders aren’t keen on borrowers who make too many applications or appear somehow desperate for credit. It gives off an air of reckless, chaotic money management. There’s nothing wrong with applying for a loan, but try to research and choose one carefully, instead of taking a more scattergun approach.
3. Watch out for fraud
If something looks wrong in your account, report it to your account provider immediately. Abrupt money absences or sudden credit applications can cause serious damage to your rating.
4. Cancel your unused cards
Sometimes, credit cards and accounts are opened because of introductory offers or perks — not that we’d recommend doing this. These cards can then be left lying around for years. An unused card might not cost you money, but it can cost your credit rating. Keep to as few accounts as possible, and use them all regularly.
5. Update your details
Incorrect information is a big no-no. It may be an honest mistake, an oversight or a typo, but such errors can have a big impact. Creditors need to know that you’ll reliably keep them up to date with your personal information: where you live, your phone number and everything else. That way, they know they can always contact you easily, and that you’re not trying to avoid them for any reason.
6. Keep your accounts separate, if they’re separate
You might have moved out of a houseshare or have gone through a break-up, but joint accounts need to be shut down after they’re finished with. Otherwise, your credit rating will be taking the hit for other peoples’ spending, as well as your own.
7. Moving home?
Sometimes, circumstances dictate that you have to move home to your parents’ house for a few months, or even a few years. While this can be difficult to avoid, it’s always best from a credit perspective to live independently, and pay your own bills, wherever you can. This will show creditors that you can look after yourself.
While you may not be able to do all of these things, trying even a couple of them will work towards improving that credit score and putting you on the road to being approved for your application.