If your credit rating is not good, the first thing that you should do is to request a copy of your credit report from one of the following national credit bureaus:
Equifax (telephone: 1-800-685-1111; website: www,equifax.com)
Experian (telephone: 1-800-EXPERIAN; website: www,experian.com)
Trans Union (telephone: 1-800-888-4213; website: www,transunion.com)
When you receive the copy of your credit report, analyze all the information and take note of the problems.
How to Improve Your Credit Rating
If you plan to buy a car and/or a home, rent an apartment, or apply for work, you must improve your credit rating so that the derogatory remarks on your credit history will be deleted. You can take some of the following actions to improve your credit rating:
1. Always pay your credit card bills on time . If you are using an online bank bill payment, pay at least the monthly minimum payment as soon as you receive the credit card statement. Add more money to your monthly minimum payment if you can afford. By paying your credit card bills by online bank bill payment, you will save money, time and effort (like no checks to write, no postage to buy, and no chance of missing your payment in the mail).
2. Maintain up to 3 credit cards in order to reduce and improve your credit ratio as compared to your income . If you have more than 3 credit cards, call the credit card company to close the credit card account with high interest rate and tell the customer service representative that the words “ACCOUNT CLOSED BY CUSTOMER ” be put on the credit card report. Such reason for closing the account will not adversely affect your credit rating.
3. Avoid maxing out the use of your credit cards . For example, if you have an available credit limit of $7,000, used the entire amount of $7,000, and you were only paying the monthly minimum payments, this situation will pull down your credit score. See to it that you use the available credit limit up to a maximum of 75% per credit card. If your available credit limit in one of your credit cards is $5,000, charge the account up to $3,750.
4. If you are applying for a credit card, do not submit more than one credit card application within a 2-month period . Every time you submit a credit card application, by mail or online, your application is recorded by the credit bureau in your credit card history. If you submit several credit card applications in a one-month period, the credit bureaus may not approve your application.
In case you do not have a credit history because you have got your first job, just graduated from college, or you did not apply any credit card before, you can do the following actions:
1. Open a bank checking and/or savings accounts.
2. Apply for a credit card with department or grocery stores that offer credit cards.
3. Talk to your bank customer service representative to help you to open a secured credit card. Then after 6 months, you can request for an unsecured credit card and close the secured credit card account.
Quote for the Day :
"In everything I showed you that by working hard in this manner you must help the weak and remember the words of the Lord Jesus, that He Himself said, ‘It is more blessed to give than to receive". (Acts 20:35 )
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