The actions we take when we are young can affect us either negatively or positively in the future. One example of this is how we manage our money. If you have built up a poor credit history, it could affect your chances of being approved for a loan when you decide to make a big investment in the future such as your first home. Why do we say this?
When applying for a loan a lender will generally look to your credit report to find out how responsible you are financially. Contained in the credit report is information regarding whether or not you are in debt and if you have a good history of paying your bills on time etc. Your loan could be approved or denied based on the information in the report so its clear to see the importance of responsible money management. So, how can you work towards improving your credit report? Here are a couple of suggestions:
Do not accumulate too many credit cards. If you have some you no longer use, call the credit card company to cancel them, otherwise a lender might think you are giving yourself too much available credit that could put you into economic danger. Keep the longest held credit cards though, as this will prove you have a longer credit history.
Its important to avoid late payments, not to mention the fees that go with them. If you find it a challenge to remember when the payment is due, why not set up an automatic payment plan to cover at least the minimum due. That way you will help maintain a good credit report.
Obtain a copy of your credit report so that you can look for ways to improve it before you decide to apply for a loan. You are entitled to a free copy of your report every year so take advantage of that provision. It will also allow you to have any errors, which appear on occasion, fixed.
Although these are just a couple of suggestions, they will go a long way to helping maintain a good credit report.
When applying for a loan a lender will generally look to your credit report to find out how responsible you are financially. Contained in the credit report is information regarding whether or not you are in debt and if you have a good history of paying your bills on time etc. Your loan could be approved or denied based on the information in the report so its clear to see the importance of responsible money management. So, how can you work towards improving your credit report? Here are a couple of suggestions:
Do not accumulate too many credit cards. If you have some you no longer use, call the credit card company to cancel them, otherwise a lender might think you are giving yourself too much available credit that could put you into economic danger. Keep the longest held credit cards though, as this will prove you have a longer credit history.
Its important to avoid late payments, not to mention the fees that go with them. If you find it a challenge to remember when the payment is due, why not set up an automatic payment plan to cover at least the minimum due. That way you will help maintain a good credit report.
Obtain a copy of your credit report so that you can look for ways to improve it before you decide to apply for a loan. You are entitled to a free copy of your report every year so take advantage of that provision. It will also allow you to have any errors, which appear on occasion, fixed.
Although these are just a couple of suggestions, they will go a long way to helping maintain a good credit report.
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