Credit Score

Top Tips to Swing from Bad to Good Credit Score

To convert from bad to good credit, improving on the pending bills is a must! Rebuilding bad credit needs greater attention with focus on revitalizing past credit information. To have a high credit score to qualify fast for credit cards and loans, you will need harder efforts. It’s a daunting task to convince lending institutions to provide loans at reasonable interest rates. The idea is to ensure that the lenders are well-versed with your financial condition and will most definitely be paid back. Like its understood, it’s quite difficult to get back to a good credit score, however start afresh!  A fresh beginning towards an improved credit score in a slow and steady way.

  • Get New Credit Accounts Opened

If due to bad credit, you cannot have a credit card approved, then it’s time for you to open a credit account. After a terrible blow from bad credit, individuals fear to get newer credit cards. The truth is that putting another credit request will help to positively work for you. If you use your credit card in the righteous way then your payment history would be substantially improved. This will only make it easier to and put you on track to building a better credit score.

We do not deny that getting a credit card from a top rated financial institution is challenging. But still there are banks & NBFCs which provide credit in a poor financial state.

Just remember to not go overboard with credit cards at the same time. Every hit has an impact on your credit score. If you let your credit score become vulnerable, it will backfire your borrowing conditions.

Its best to look for credit cards which are specifically designed for low score individuals, in fact they know the situation well before proposing an option. These are known as subprime cards meant for bad credit times. The greatest minus here would be interest rates and additional fees.  It can land back into an indebted state. This time after damaged credit, it will be even worse to repair an inch.

Using pre-paid cards can be just as detrimental in a bad credit state. A prepaid card is not reported as a part of the credit history and not considered by the credit bureaus. They are not as valuable as the credit cards.  Even if you use your prepaid card carefully, it will not influence your credit.

The crux of the matter is to bravely handle your credit rejections. It’s terrible to keep applying for a credit card after several rejections. Instead, expect for a reply back from the credit company, quoting the relevant reasons. Whether the income bracket, past employment, credit position, etc for rejecting your case, straight away.

    • Work on Healthy Credit Habits

If going by a certain financial pattern you’ve landed in bad credit, then it’s time to change. Try and build healthy spending behavior over time and follow a balanced approach. Obviously you do not want bad credit all over again, hence its better to slow down.

Due to multiple options, its easier to make a purchasing decision. However, it’s foolish choose a payment method which doesn’t very well. skipping payments can be ridiculously damaging after all the payment facilities made possible.  A simple way to improve your credit score is to stay below your credit limit at all times, and making timely payments of credit statements. Just make a transfer from old credit habits to the improved ones.

  • Make all Timely Payments

Your payment history built over time validates your financial discipline. It plays a major role to build your credit report.  An overdue payment can negatively impact your credit report and reflect badly for a lending institution.

Just take care of account delinquencies, even the trivial ones. Most lenders partner with collection authorities to recover a partial payment.  Whenever a case goes to the credit bureaus, the same gets notified to the collections team and reflects on your credit report for 7 years.

Related Articles: Have Low Credit Score? Top 5 ways to Fix It

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