Credit Score plays an important role when you apply for a credit card or loan. It is a 3 digit number that reveals the creditworthiness of an individual to banks and other financial institutions. Credit Score is calculated using your credit history, which contains information such as your payments history, number of loans or credit card used by you, etc, there are 3 major Credit Information Companies, namely Transunion, Experian, Equifax. A high credit score increases your chances of getting a loan or credit card and a low score completely ruins it. Banks do not like to give loans or credit cards to people with a low score because they do not trust them with their money. Despite having a low score, if you get a card or loan, then your credit limit may be low or you might have to pay a very high rate of interest. To prevent this, you must improve your credit score.
One of the important things that you must do to improve your credit score is check your credit report. Doing this will help you in identifying errors in your report
If you have any outstanding credit card bills or loan, you must pay it off immediately to repair or improve your score a bit. Payment history is one of the factors that is taken into consideration while calculating the credit score.
It is another major factor that is considered while calculating the credit score. The amount of credit that is available to you versus how much of it you are using shows your dependency on credit money.
Some people tend to remove old accounts or deactivated accounts or accounts with negative history from their credit report to make it look good. Some even try to get their old debts removed from their reports once they pay them. This may not be a very smart thing to do.
Many people whose scores fall drastically are ones who do not plan their finances well. If you apply for too many credit cards just to increase your credit limit, but are unable to pay the bills off on time of all of them,
Many people whose scores fall drastically are ones who do not plan their finances well. If you apply for too many credit cards just to increase your credit limit, but are unable to pay the bills off on time of all of them,
