So now you are fresh out of college, newly employed with all sorts of financial cards in your wallet. Being newly employed drives you to have this new craziness of acquiring a credit card. So, you submissively fill out your forms for acquiring a new credit card but only to found out that few weeks after your application has been rejected. Why? Because you do not hold any credit history? Well then grab a credit card!! If you are sure you do not have any credit history and you cannot acquire one, then you are wrong. Any kind of loan be your student loan or any club membership is all you need to show for applying a one. But then if you are a fresh entrant of acquiring a one and you are struggling with a bad credit score, then follow these steps to improve your score:
First know what exactly is a good credit score?
A good credit score is decisive for financial accomplishment. Your score determines the approval of your lenders for lending you the money plus it also determines at what interest rates are you being charged. Thus, the degree of extent of your good score will lead you to the degree of the approvals and also the optimal charge rates will be applied on your credit.
Clear your Debts
If you a person who depends on his overdraft accounts, then make sure you have already paid the previous loan on that account. Moreover, paying your other installment loans like your home EMIs or car loan will affect your score but paying down the payments of particularly credit cards with higher interest holding will have a drastic effect. Use your credit report to make a list of all of your accounts and then go online or check recent statements to determine how much you owe on each account and what interest rate they are charging you.
Pay down a balance close to the limit
Your credit utilisation– how much of your available credit is being used – is 30% of your credit score. The closer your balances are to your credit limit, the worse it is for your credit score. If you have a lump-sum of cash you can use to pay on an account, put it toward a high balance. (If you have to choose between paying a past due balance that hasn’t yet been charged off or paying down a balance, pay the past due balance
Have your own Blend of accounts
Having various types of credit accounts is critical. It shows that you are a reliable borrower who is experienced enough to handle different credit accounts and who has a history of paying in due time.