Improving your credit history is a gradual process that requires consistent effort and responsible financial behavior. Here are some actions you can take to positively impact your credit score.
Credit Utilization:
Keep your credit card balances low: Aim to use no more than 30% of your available credit limit on each credit card.
Pay off debts strategically: Focus on paying down high-utilization accounts first while making at least the minimum payments on other accounts.
On-Time Payments:
Set up payment reminders: Utilize electronic reminders, automatic payments, or calendar alerts to ensure you never miss a payment.
Create a budget: Establish a budget that prioritizes timely payments and allows you to meet all your financial obligations.
Account History: Maintain old accounts: Keeping your oldest credit accounts open shows a longer credit history, which can positively impact your credit score.
Responsible credit behavior: Continuously demonstrate responsible credit management by making on-time payments and keeping your balances low.
Types of Credit Accounts: Use different types of credit responsibly: Aim to have a mix of credit accounts, such as credit cards, loans and mortgages, and manage them responsibly.
Avoid opening unnecessary accounts: Only apply for credit when you genuinely need it to avoid excessive debt and unnecessary inquiries on your credit report.
Additionally, there are a few more general strategies to improve your credit history:
1) Regularly review your credit report: Monitor your credit report for errors or discrepancies and report them to the credit bureaus if necessary.
2) Limit credit applications: Avoid applying for multiple credit accounts within a short period, as it can negatively impact your credit score.
3) Maintain a stable financial situation: Stability in employment, residence, and financial stability can positively influence your creditworthiness.
Remember, improving your credit history takes time and patience. It's essential to consistently practice responsible financial habits and maintain good credit behavior over an extended period.
Information shared by Brian Swanson, Guild Mortgage, NMLS#400119, PH: 515-988-3866
