Pay your bills on time
If
you want to improve your credit score
with time, you need to keep a clean track record. Payments constitute more than
25% of the credit profile. It is critical that you automate your payments and
pay your credit cards on time.
Do not keep any outstanding or
overdue bills
When
you get a bill, you need to pay off the entire bill in its total amount without
keeping any overdue or pending amount. There should not be any outstanding or
overdue pending amounts on your credit card bills.
Maintain a balanced credit mix
You
need to have a balanced credit mix with the help of secured and unsecured
loans. Do not completely saturate your credit profile with the help of only one
type of loan. Secured and unsecured loans need to be balanced in order to
improve your credit score. Read Here : How is business loan
calculated?
Maintain a balanced debt-to-income
ratio
If
you have existing loans, make sure you pay them off before taking a new loan.
If you are trying to build your credit, it is important to have a balanced
debt-to-income ratio. Why not? It will help in improving our credit score with
time.
Keep your credit account open
It
is very important to keep your credit account open that has a long credit
history. If you have a credit card or loan with long transaction history and a
clean track record, you need to keep the credit account open.
Must
Read : 6
Obvious Reasons To Check Your Credit Score Regularly
Do not apply for multiple loans
It
is very important to stop applying for multiple loans. Within a short span of
time, do not apply for multiple loans, as that can damage your credit score
immensely. Make sure you work on the loopholes other than applying for multiple
loans. The hard inquiries run on your credit profile
will damage your credit score.
Keep your credit utilisation ratio
below 30%.
It
is very important for you to keep the credit utilisation ratio. The credit
utilisation ratio is the ratio between the total credit limit available and the
limit that has been exhausted. If you exceed the available credit limit, it
will damage your credit score.
Wrapping up
A
credit score is an important factor
for borrowing. Make sure you start with your credit score check in order to get an affordable loan.
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