How Do I Raise My Credit Score?
Raising a credit score can be important for many reasons. Consumers with poor credit scores may find themselves unable to secure a home loan, unable to get new credit cards or even unable to rent an apartment. Virtually everything financial relies on a consumer’s credit score, which means that a few years of mismanagement, can cut a consumer off from many financial options.
Luckily, it is not as difficult to raise a credit score for many people who assume that it is. A credit score is primarily composed of the amount of credit utilization a borrower has, the average length of their accounts, the types of accounts that they have, any collections or bankruptcies on the account and any hard credit inquiries against the account. Improving any of these areas will improve the borrower’s overall credit score.
Raise Credit with New Car Loans or Credit Lines
Borrowers that are intending to increase their credit score over a lengthy period of time will find that acquiring new types of credit will do a lot to increase their credit score. Opening an auto loan is one of the best ways for a borrower to increase a credit score, as is opening new student loans. The loans will need to be repaid on time and will show that the borrower is able to deal with credit in a responsible way.
Borrowers can also open up new credit lines and keep them paid every month, but this can lower the average length of their accounts. Raising a credit score can also be done by paying down existing balances, but this is not always possible depending on the borrower’s current financial situation.
Improve Credit Scores with Alternate Financing
Borrowers that cannot successfully raise credit scores often may need to consider alternative financial products to meet their needs. Those who are interested in securing an automobile loan can consider going directly to the dealership to discuss their current financial situation and ways that the dealership can meet their needs. Those who are interested in the purchase of a home can consider mortgage lenders that specialize in bad credit home loans.
Personal loans can be taken out through bad credit car loan companies or cash advance companies. There are also credit counseling agencies and credit repair companies that can help borrowers manage their current debt and prepare for the future. Debt settlements, debt management plans and debt consolidations are all ways that a borrower can manage their debt while improving their credit score and learning more about their financial situation.
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