How to achieve a healthy credit rating
‘Credit rating’ is a small phrase that can instil fear in the bravest of people. There’s good reason for this, as having a poor credit rating can significantly hinder your ability to borrow. Whether you need to apply for a credit card, a loan or a mortgage, it’s the people with the healthiest credit ratings as determined by the predominant credit reference agencies, Experian and Equifax, who will be loaned money at the best rates. Consequently, it is in the interest of everyone to keep their credit scores healthy in order to maximise their potential capacity for borrowing in the future.
What not to do
There are a number of actions you can take that will severely damage your credit rating. Your credit score is not something that improves overnight, so it is in your interest to avoid common mistakes that lead to poor credit. One sure fire way of having a poor credit rating is by not paying your bills on time. Should you end up with a County Court Judgment or default, this will put a black mark against your ability to borrow money at a reasonable rate in the future.
It may not even be your credit history that is getting you in trouble with potential lenders, but the credit history of somebody who you share a joint account with. If you have a joint account with someone who has a poor credit history, this could have a knock-on effect and be detrimental to your own credit rating.
What to do
If you have an unhealthy credit score, the good news is that there are a whole host of actions you can take to get your credit rating looking considerably healthier. You should always endeavour to pay your bills on time and to pay off your credit card debt in full at the end of every month. This will convince future lenders that you are responsible with your money and that you will make timely repayments should they choose to lend you money.
Are you registered to vote? If not, you are missing a very simple way of boosting your credit rating. Make sure you register to vote as soon as possible, as this will have a positive effect on your all-important credit score.
Believe it or not, taking out a new credit card could actually improve your credit rating – you simply have to ensure that you choose the right one. If you shop around for credit cards for poor credit, you will find that there are many options in the credit cards market, including the aqua card. By using one of these credit cards and always paying your balance in full, you will be demonstrating to prospective credit card companies, loan companies and other lenders that you are trustworthy and can be relied on to pay your debts in a timely fashion.