Your credit score affects many aspects of your life. This document has penetrated tightly into the everyday life of a person and few people doubt its importance and credibility. But with all this, few know how to improve the credit history, if it does not allow to take another Payday Loan from the bank.
Credit rating is one of the most important criteria for identifying a potential borrower and determining its solvency. The data in your CI is updated daily, which means that it can be changed in a relatively short time.
Here’s how you can develop a plan and increase your creditworthiness, which will help you save money on interest on the loan in the future and open up more opportunities.
First step: getting a credit history
First of all, you need to get your credit score on hand. Once a year it can be done for free. If it was needed more often, you have the right to familiarize yourself with the document, however, already for a fee. The story is kept in the credit bureau. There are about twenty of them in our country. On the website of the BCA Bank, you can find out exactly what is your. CI may be located in different bureaus, therefore, most likely, several requests will have to be made. At the same time in each of them there can be only a part of all the information, and the whole story will need to be collected bit by bit.
Just like you, banks make inquiries to the offices with which they work. Therefore, they may not see some of your credit history data.
Understand the document
After receiving the document, review it and make sure that there are no errors in it. If there are any delays, you may be able to remember the reason why you did not pay on time. Prepare relevant documents confirming the valid reason for the delays.
How to improve credit history should know anyone who plans to continue to get a loan. One person may have an empty credit card, but not a single delay and rather large payments. Another borrower has a large amount of money on his balance sheet, but there are glaring mistakes and a short period of history. It is difficult to give a specific assessment of each CI, especially since each bank will evaluate it in its own way. But there is a sample table, which data affects the overall rating:
- 35% – the history of all payments;
- 30% – the amount of debt;
- 15% – the period of history;
- 10% – new loans;
- 10% – all loans together.
As you can see, the first two points “weigh” more than the others – it is very important to develop a strategy “how to improve the credit history” in the direction of them.
When you know the details of your credit report and calculate its overall rating, you can develop a plan for becoming a good borrower in the eyes of bankers. For example, if you notice that you have made a delay in payments, and because of this, the estimate has deteriorated – put a reminder of payments or install an automatic payment in your account. If there is no financial opportunity to repay the payment on time – take a loan with a bad history (a microloan), because the payment for it can be much cheaper than the consequences of a bad credit history.
Learn more about how to improve your credit history.
You need to instill yourself good habits that can help you with this. Here are some specific suggestions that help improve credit history:
If possible, get rid of the loan balance. At the first opportunity close the balance of the current loan. If there is no finance for the full repayment – close the part and as often as possible. This will be documentary evidence that you can handle credit obligations, which will be a big plus when considering your candidacy in the future.
Make several payments per month. Show the bank that you pay for the loan, not when it requires it, but at the first opportunity. Credit history is like a photo at the moment, which you may need in the coming days. Therefore, improve the rating of your CI every time it is possible. Moreover, for many loans the interest rate is calculated daily, so it is more profitable to make two payments of 1000 rubles each than one for 2000.
Open a new credit card. A new card may be a new foundation in building a “new” improved credit history. In addition, it will increase your credit limit. But just do not need to open multiple cards to increase the available credit. Open one and use it responsibly, adding positive data to your CI.
Now you have learned some steps how to improve your credit history. Develop your plan and follow it. If there are mistakes and shortcomings – be patient and overshadow them with positive actions.