What is a good credit score | Improve your Credit Scor
What is a good credit score- This has been a question that most people ask. If this is your question, then it’ll be solved in this article. But before we proceed, let’s look at what credit score is.
It’s just like the name sounds is the record of scores all credit card users and borrowers use when considering to get a loan. Credit scores are mostly considered when individuals want to borrow money from fame or a bank.
Most times when your score is low, you won’t be able to get a loan or borrow money from the bank. Most times when you want to apply for a credit card, it won’t be given to you, because your credit score is low. You can be deprived of so many things if you have a low credit score.
And this is the main reason for this article, I’ll be showing you few ways you can improve your credit score. In case you have a low credit score, keep reading this article to find out what you can do about it.
A credit score has some information about your credit experience. For example, about your bill payment history, the type of account you’ve, and also the number. It has space where it specifies if your bills were paid on the due date. However, the credit card score gives an award point to the bearer.
This point is most given to people that pay their money early and also at the required time. The total number of credit points you receive determines how worthy you’re. And it also improves your credit card. A credit score is also used by some insurance companies.
what is a good credit score?
Credit score can be determined mainly by two scoring models. You can see it below.
- FICO Score.
- Vantage Score.
FICO: this is one of the primary models that determine credit scores. It uses a foretell analysis by taking customers’ information and analyzes it. The five basically used factors for scoring models are
- Credit history
- Payment history
- Types of credit
- Total debit
- Credit inquiries.
All of these factors have their own role to play in individuals’ credit scores. To get a FICO score, you’ll have a particular amount available in your credit. It has a way of showing if a person will be able to pay back a loan on time or not.
Vantage Score: this calculates customers’ credit scores just like FICO, however, it has a different procedure. Vantage score has different categories in their credit card. You can see some of them below.
- Available credit
- Depth of credit
- Total Balance
- Credit Utilization
- Payment History
- Recent Credit
How to Improve your Credit Score
I’ll be showing some of the things you’ll do to improve your credit score.
- Don’t spend more than you earn
This is very important, most people fall victim to this so many times. They tend to do it a lot. Please don’t spend more than your earnings, get and buy things you know you can pay for. “Cut your cloth according to your size” and “don’t bite more than you can chew” all these are adage but if has a massage it’s passing through.
When you buy items that are more than your earnings, you’ll run into owing which will spoil your credit scores. I’ve so many things to say on this, but I believe with these few words, you’ll be guided.
Don’t apply for a New Credit
Avoid applying for so many credit cards, when you do, a notification will be showing as a “Hard Inquiry”. If you have a credit card that has lasted for two years, it’ll affect your credit score. Ensure you pay off your credit before applying for another credit. When you don’t pay on time, your credit score will be very low. However, don’t allow your credit to stay more than the expected date before you pay up your credit. If you know your earnings on monthly basis are low, please avoid applying for a credit card.
Check your Credit Score
Knowing your credit score will help you know when your credit is running low will help you manage it. It’ll guide you on how you spend, and also when to reduce your spending. However, you can check your credit scores by getting copies of your full credit report.
You can get it from three different bureaus which are Experian, Equifax, and TransUnion. You can get this information for free ones in every year and you can check it at www.annualcreditreport.com. However, you can also put a call through other websites that give a free credit score check.
Pay On Time
When you delay in making the payment it’ll affect your credit score. And also it’ll affect your credit score. Because of what you stand to gain when you’ve low credit, you must avoid this.
Low credit can stop you from benefit so many things, like accessing loans from banks, and other things. With some listed steps in this article and some information, I know you’ll be guided on how you can avoid low credit.