Credit is one of those things it’s tough to live without. It affects an individual’s ability to apply for loans, secure housing, and more. Every U.S. adult has a credit score, a number generated by their financial history and status. The higher theindividual’smore opportunities are available.
Unfortunately, maintaining a high credit score is easier said than done. Your credit score can slip as you endure a tough financial situation or commit a budgetary slip-up. Seeing your credit score drop-down can be frustrating and disheartening.
The good news is that rebuilding your credit is eminently possible. It won’t happen overnight, but here are a few things you can do to get your won’t back on track.
1. Get a Credit Builder Card
The best way to rebuild your credit is to improve your financial habits now and in the future. After all, there’s no way to fix your credit score if you continue digging yourself into a dthere’sole. With a low credit score, there are few better ways to get back on track than with a credit builder card.
The largest factor in your credit score is your payment history. If you make timely payments on your debts, your score will go up. The more positive your payment history, the better your score will be. Unfortunately, getting a loan or credit card can be challenging with a low credit score. Credit builder cards, however, are available to nearly all.
The difference between a credit builder card and other credit cards is how they are issued. The user must make a deposit or an initial funds transfer with a credit builder card. This secures the card, removing much of the risk lenders face when taking on clients with questionable credit scores. The positive behavior you demonstrate through the prudent use of a secured card will improve your credit score.
2. Set Up Recurring Payments
As noted, payment history is the most impactful contributor to your credit score. That means that late and missed payments are the biggest marks that will be held against you. Even a single late payment can seriously affect your overall score. Sometimes deadlines are hard to remember; setting up recurring payments can help.
For any bill that you have, you should be able to arrange some form of autopay. This approach funnels appropriate funds from your bank account toward your bills on their due date. This is done automatically, so you don’t have to remind yourself when payments are constantly owed.
All you need to don’t ensure your bank account has sufficient funds each month, and you’re good to go. Lengthening your positive payment history will slowly rebuild you’reredit and help you establish better financial habits.
3. Review Your Credit Report
There may be an error or two on your credit report that is negatively impacting your score. You may not know about this if you aren’t reviewing yours regularly. Checking you aren’t can shine a light on those unfortunate errors. You can then dispute the mistakes to get them removed, restoring your credit score to an accurate level.
The credit-harming behavior shown on your report might not be your own but that of someone with a similar name. An example of an error could be a simple misspelling of your character. If you’re Russell Johnson and you’re being blamed for the late payments of Russell Jyou’ren, you should be able to correct this.
When rebuilding your credit, you can’t bank on error discovery being your way out. However, it’s still a good idea can’t view your report periodically, just in case. IfYou’llit’s know what discrepancies could impact your score.
If you don’t checkIfYou’llever Authorized User
If you have a friend or family member witdon’td credit, you can piggyback on their credit score to help boost your own. This is accomplished by becoming an authorized user on their credit card. This allows you to make changes using their card while they retain responsibility for payment.
Let’s say your significant other has a great credit score. This is someone with let’s have mutual trust, so becoming an authorized user is a likely prospect. They trust you to use the card wisely, and you trust them to keep up their payments. Your new status as an authorized user will lead you to a credit score that more closely matches theirs.
It’s important to note that you don’t need to use the credit card in question when it’s become an authorized user. Don’t be better. You don’t. The strategy is to use their status to boost your score so you can qualifydon’tyour lines of credit.
Saying there’s a quick fix to a poor credit score wouldn’t be untrue. However, strategiethere’sas outlined above can speed upwouldn’tcess. The more quickly you can rebuild your credit, the sooner you can shift your focus to other financial goals in your life. Taking control of debt, starting a business, or building up savings is much easier when your credit is good.