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4 Ways to Improve Your Credit Rating

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Your credit score is something that you can spend years and years not even thinking about, let alone trying to improve, but the truth is that if you are in that situation when it comes to applying for a loan or mortgage, for example, you may well struggle.

To avoid any future issues, or if indeed you are getting ready to buy a home and are looking for mortgage pre-approval, then continue reading to discover four effective ways to improve your credit rating.

1. Prioritize Paying Collections Accounts

If you are serious about boosting your credit score, you need to seriously prioritize and commit to removing any threat of being sued due to a collections account that you have previously been ignoring.

Moreover, if you do manage to pay off the collections account soon, it may be possible that they will stop reporting the debt to the official credit score calculators. Additionally, if you have any old and now defunct collections account reports on your credit score, you can certainly ask for these to be removed.

2. Try to Reduce Current Interest Rates

Whether you have one or more credit cards, or you are currently making regular monthly repayments on a personal loan, you need to know that you are not necessarily tied to that particular interest rate.

Instead, speak to your credit card or loan provider to see if there is any room for negotiation when it comes to your interest rate currently and also see if you can change your credit card to one with 0% APR. Remember that the healthier your credit score is, when you are looking into how to get a mortgage, you are more likely to be able to borrow the amount you are hoping to.

3. Always Use a Secure Credit Card

Another exceedingly helpful tip to increase your credit score is to apply for a secured credit card, which is the type of card that is always backed by a cash deposit upfront.

In most cases, said deposit is the same amount as your credit limit and when you pay back your monthly payments on time, your credit rating will increase. A secure credit card is especially helpful for those individuals who are new to applying for large amounts of credit, but it is worth noting that it takes a little time to improve your credit score with this option.

4. Ensure You Pay Every Bill on Time

The fourth and final suggestion to help boost your credit rating in this article seems, upon the first read, to be somewhat of an obvious one, but in fact, may well be the best way to help your credit score of them all.

Even if you miss just a couple of payments, regardless of what the exact payment is for, this misstep could stay on your credit report for around seven years, so you must make this your top priority moving forward to make things easier for you.

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