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Easy Steps to Improve Your Credit Rating

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Bad scores, without a doubt, can be costly and stressful. It is the poor financial decisions such as auto loan, mortgage plan, low balance, or overspending is what may affect your credit scores.  Building good credit scores is one way you can do to stabilize your credit rating. Plus, it is crucial to avail credit card rewards, borrow money, and access products and services such as loans.

No matter how worse the situation might seem, poor credit rating doesn’t last forever if you take precautionary steps to improve your credit scores.  That means credit rating is basically a reflection of credit history. It changes when new information or scoring is added to a credit report.  And when you start handling your credit scores efficiently and more responsibly, the rating improves.

If you’re looking for some effective steps to raise your credit scores, we have you covered here. But before that, let’s clear our understanding of what a credit score is and how you can check it.

What is a Credit Score?

As mentioned above, credit scores are created from the rating held in a credit report that is also called a credit file.

Your credit score number can be different for different products, even if they are from the same loan company. It primarily depends on criteria that are used for assessing your credit file as a customer. The information sourced from your credit report is often used to decide:

  • Whether to borrow you or not?
  • How much interest should be charged from you?
  • How much can you borrow?

The recent the file is, the greater the impact it will create. Lenders, banks, or loan companies are more interested in the current financial state of the filer. That means your financial decisions of the past six years, whether good or bad, must be on the record.

 If your credit file shows an inconsistent payment record, the lender can charge you higher interest. You might not be considered an eligible candidate for loans. Your missed payment record can raise the concerns of your lender, and he/she might consider lending you money is of high-risk.

Moreover, your credit record or credit history affects your ability to qualify for insurance deals or cell phone contracts. That is what makes checking your credit file regularly extremely important if you want to avoid any mistake or fraudulent activity in the report.

How Can You Check your Credit Card Score?

The three credit bureaus TransUnion, Equifax, and Experian, create credit reports. To receive your credit rating online, you can send a request to these scoring agencies. The online service is free and sends you the softcopy of credit file via email.

Use Credit Score Membership

You can also subscribe to the membership of these credit score agencies. Subscribing them allows you to get updated information on your credit report.  Plus, some of these agencies enable you to access their agents who look into your credit report.

If you’re on a free trial, make sure you cancel the membership to avoid monthly subscription charges.

Open a Fair Credit Rating Credit Card

You can compare credit card promos all in one place for different types of programs and rates that will provide you with different credit rating requirements that might fit your credit score and can apply online and get instant results after applying.

Steps to Improve Your Credit Scores

Step: 1- Get Your Credit Report

 Getting a copy of your credit report is the first step you need to take for improving your credit scores.   Determining the status of your credit rating will help you find out what exactly needs to be fixed.  As mentioned above, your credit score is based on your credit record information, so you need a copy of it to identify the account you need to work on.

Step: 2 – Pay Your Due Bills

The next step is to check your payment history. It makes 35 percent of your credit rating, which is more than other factors. If you’ve a history of paying your bills late, it may affect your credit score. Make sure that you start paying your due bills.

 Remember that each on-time payment will update positive information in your credit report.

Step: 3 – Dispute Credit Report Errors

You can’t avoid errors when it comes to generating credit reports. It is always better to review and assess your credit report closely for the following:

  • Any fake accounts on your name
  • Wrong credit limit and data in your account
  • Social security numbers and accounts that are not yours
  • Addresses of the places you have never lived
  • Negative information; late payments ( if there is a payment older than seven years in your credit report, it is illegal)

In case you find of any error listed above, immediately report to three credit bureaus to dispute the errors.  Visit the Federal Trade Commission (FTC) website to find detailed steps for error correction.

Step: 4 – Pay Your Due Credit Balance

Loan companies heavily scrutinized your debt amount for your credit rating.  Three major factors that are analyzed are:

  • Total debt owed
  • Accounts with no due balances
  • Amount of available balance or used  credit

Your total available credit is compared to reported debt to determine the debt-to-credit ratio. The best way to keep debt amount low is to pay it as much as you can.   Don’t consolidate your debt on one low-interest card. Plus, avoid credit inquiries and applying for new credit cards until your old credit balance is paid off.

Step: 5 – Use Your Credit

It is important to use credit regularly as a creditor to keep your credit report updated and accurate. While debit cards or cash payments may seem budget-friendly options, a cash-only lifestyle doesn’t improve credit rating.

Using your credit with a credit card is the best way to do it; especially when you’re trying to raise your credit rating to qualify for a loan installment.   If you haven’t used your old credit card for a long time, you may start using it. Reactivating a dormant account can be advantageous for your credit scores.

Final Thoughts

Overall, good credit scores come with several benefits, and by following these simple steps, you can easily improve your credit scores.  Monitoring your credit report is a key to keep tabs on your account activity, plus make sure you pay your balanced payments and credit to maintain a good reputation to qualify for the rewards and other benefits.

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Steps to Get Credit report for Free

A credit report is typically a financial report. If you have ever used a credit card or requested a loan, your bank evaluates credentials through your credit report. From the number of credit cards you’ve used in past, payment details, money that you owe on cards to the loans you’ve taken, a credit report lists them all.

All these factors make your credit card score, which is a three -digit number that indicates how risky of a borrower you are. That means if your borrowers’ grade point average is low, you might face difficulties in applying for new credit cards and loans. It is important to note that your credit report is thoroughly evaluated when you apply for a new loan or credit card.

That is why checking your credit report is of paramount importance multiple times a year to make sure that its information is correct. However, you must not pay to get a credit report.  If a lender or website is charging you money or asking your personal information for a credit report, do not fall for this fraud.

It is because you can easily get your credit report without spending a penny thrice a year. You can submit your direct request to AnnualCreditReport.com, or you can receive it from credit bureaus Experian, TransUnion, and Equifax.

 Let’s see what steps you can follow to get credit report for free;

Steps to Get Your Credit Report for Free

1.     Select a Credible Source

While sources like Credit Sesame or Credit Karma allow you to see credit scores at anytime, you cannot access your credit report more than three times a year. You can only check once when major credit card bureaus send you. This is what makes picking an appropriate source an important step to get a free credit report.

2.     Call 1-877-322-8228 or Submit Request at AnnualCreditReport.com

To receive a free credit report, you can submit a request through AnnualCreditReport.com. Also, you can call on the verified number 1-877-322-8228. Remember that if any other source claims to provide a credit report and ask you to exchange personal information, it is a fraud.

Moreover, requesting a credit report will not negatively affect your credit history or credit, but you are limited to receiving three reports a year as per federal laws.

3.     Fill an Online Credit Report

If you want your credit report through a website, you need to fill out a submission form. Regardless of how many forms you want (one to three), submitting the form for the allotted report is necessary.  You will have to fill out some basic information in the form such as your name, your current residential address, and social security number.

4.     Decide Number of Credit Reports You intend to Review

You need to select the credit bureau you want credit report from. Pick Experian, TransUnion, and Equifax, or all three major credit bureaus. These bureaus have all your credit-card histories and information that they get from creditors.  However, not all three of them contain the same information. This is where you need to choose the right credit bureau as this may lead to variation in your credit history information each bureau has recorded.

The best practice is to review all three credit reports to different point in time. Setting reminder to send a request for your credit report will help your view each report individually. However, if you are planning to make a big purchase such as buying a house or car that requires you to check credit, you can request all credit reports at once. This way, you can review all three of them for identity theft and accuracy.

5.     Respond to Security Questions

Before you receive your credit report, bureaus ask some security questions to assess your credibility or verify identity. The information in the questions is based on your credit report and is often tricky. You are given only five minutes to complete the answers.

 If you want to request all three reports from different bureaus, you have to answers the questions for each bureau.

6.     Submit a Request to Review Credit report

Once all the steps mentioned above are complete, the credit card bureau website will generate your report within minutes. If the report is requested via phone, the bureau will send it by mail that may take 15 to 20 days.

Your credit report has five sections:

  • Personal Information: the section comprises your name, addresses, date of birth, and contact details.
  • Accounts: the section incorporates the entire history of your different credit lines you have had, account status, current balance, and account opening date, minimum payment, credit limit, and highest balance.
  • Public Records:   the section lists your legal matters related to bankruptcy, tax lien, etc.
  • Hard Inquiries: your applications for new loans and credit cards (in the previous two years) will appear in this section.
  • Soft Inquiries:  if any insurance company, credit-card lender, employer, or lender has made an inquiry for your credit card, this section will show them.

7.     File a Dispute in Case of Any Discrepancy

This is one of the most important steps that hold the main purpose of getting a credit report. Once you receive your credit report for free, inspect it for correct payment details, balance, dates, etc. if you find any discrepancy in the information, or you find the details entirely unrecognizable, and then file a dispute. You can do it online or call the credit bureau helpline.

It is important to know that you only get credit report for free from credit bureaus, but you have to pay for identity-monitoring services.  It is because credit bureaus have unlimited email alerts, and credit reports if a fraudulent application for credit on your ID or name.

Final Thoughts

Overall, requesting a credit report doesn’t only help you determine your payment history but in several other matters. They are immensely helpful when it comes to managing your credit balances and applying for new loans. Thus, the given steps will help you get a credit report for free.

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