If you're considering switching rentals in the future and have bad or poor credit, it's important to think about improving your credit as soon as possible. But just how do you go about improving your credit score? Let's go through some of the steps you may want to consider taking:
Make sure you know what your credit report is showing. The Federal Trade Commission (FTC) provides information about how to get a free copy of your credit report. Credit Karma lets you see your credit scores for free and they claim that checking your score won't harm your credit. If there are errors on your credit report, work towards getting them resolved.
Be sure to pay your bills on time. Don't be one of those people that considers paying a late fee for the ability to pay a bill after it's due!
Don't max out your balances. Just because your store credit card has an $800 balance and you've only charged half of that amount, don't risk heading out to charge more. Your goal should be to minimize your debt as much as you can.
Bring down your debt if possible. There are differing opinions on the method you should follow for doing this. Let's say you have three credit card bills - one with a $500 balance charging you 14%, one with a $2000 balance charging you 18%, and one with a $5000 balance charging you 12%. Some people feel that the best way to tackle debt is to get rid of the smallest balance first because they can do it the quickest. Others prefer to eliminate the balance with the highest interest rate first, and yet others feel that they need to get rid of their highest balance first. Whichever method you choose, commit to reducing your debt each month.
Once you pay off an account, seriously think about closing it. You won't find yourself being hit with annual fees for accounts you no longer need, and you won't be tempted to spend money you really shouldn't be spending just because you have a card with a $0 balance in your wallet.
Don't be tempted to keeping opening up charge accounts just because they are offered to you. Yes, they may come with interesting sounding perks, but having credit you don't need may actually hurt your credit score. You also don't want to find yourself tempted to buy things you don't need just because you have credit available.
If your score is low and you want to work on improving your credit, you may want to consider Experian Boost. Experian is one of the three major credit bureaus. Their boost service says that it can help you raise your score by giving you credit for paying your phone and utility bills. Take a look at what they're claiming and see if you think it might be helpful.
Be cautious about signing up with companies who promise to fix your credit issues. Oftentimes they are just trying to get your money and they can't do what they say they can do. Also be careful with providing your financial information to just anyone you come across over the internet.
Fixing your credit takes time. It's important to do everything you can to not hurt your credit in the first place. For more suggestions on how to improve your credit score, take a look at Credit.Com's article on 11 Ways to Improve Your Credit Score. It contains some good advice on how to correct errors in your credit report and it gives suggestions for things that can help you to improve your credit score.
For more information on financial and other information of interest to renters, check out these posts:
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