Got A Low Credit Score? Here’s How You Can Raise It & Exactly How Long It Will Take
Also known as credit rating, the credit score is a three-digit number which determines a person’s likelihood of being approved for credit by institutions like banks and credit card companies. This said it follows that higher credit scores are considered better.
According to Experian Information Solutions, anything above 700 is considered good while a score exceeding 800 is excellent. In reality though, most people have a credit rating of between 600 to 750.
There are many things which can affect a person’s score for better or worse. For example, simply missing credit payments can set one’s credit rating back. Read on to know just how important keeping a good credit score is and find out how your score can bounce back after a setback.
The Importance of Credit Rating
Because your credit rating will determine the interest rates you’ll get when applying for loans or paying off credit cards, having good credit can easily save you thousands of dollars as time passes. What more, a mere 15 to 20-point shift in your rating can cost you the difference of being approved for better terms or being completely declined on a much-needed loan, according to Experian director Rod Griffin.
While you’re score is currently down at the moment, it’s worth noting that the average credit scores today have consistently risen since their low when the last financial crisis happened some ten years ago.
It Takes Time
According to financial experts, the time it will take to recover one’s old credit score after a recent decrease will vary. For example, running late on a payment on your mortgage, considered one of the more serious offenses, can take a person around nine months to correct.
However, raising one’s credit score after going bankrupt and filing for bankruptcy will take much longer. SuperMoney CEO Miron Lulic estimates that it would probably take somewhere around five to 10 years to bounce back from this major setback in one’s credit history.
So, how does one actually go about improving their credit score?
Where to Begin
No matter where you begin, there are many simple yet impactful things you can do now to jumpstart your journey to get excellent credit. First, check your credit reports and look for errors in the statements. Then, dispute all of the mistakes you can find.
Another way to start building good credit is to always play bills on time. This is because late payments can remain in your reports for as long as seven years. In relation to this, make sure to pay the balances in your credit card. Doing so, would decrease your credit utilization ratio and do your rating wonders.
More in financial advisor
This Travel Expert Has a Secret Formula for Finding the Best Luxury Hotel for Your Next Holiday
These days, one can make a career out of literally anything. For one Philippe Kjellgren, traveling is a full-time job. He’s...January 7, 2020
These Money-Managing Apps Will Help You Save Up This Year
Saving and managing money has always been a struggle, it is that moment that you would realize how difficult it is...January 6, 2020
5 Things Every Self-Employed Worker Should Do to Secure His Future
According to statistics, more and more people are ditching the traditional 9-to-5 jobs to work for themselves. An estimated 4.8 million...January 6, 2020
Majority Of Americans Lack Financial Management Skills, Research Shows
The world over admires Americans for their self-confidence and infrastructural development. However, Americans are not perfect beings without flaws, and one...January 5, 2020
These Are The Newest Must-Have Gadgets You Need
If you are a fan of the latest devices which were introduced in the market you certainly will have a list...January 5, 2020
Experts Say Millennials Will Be The Richest Generation In History
Experts believe that the millennial generation is literally taking over the world, and they also think that they will be the...January 4, 2020
Students Are The Best People To Benefit From Amazon’s Textbook Rentals
The biggest online retail store in the history of the world has got to be Amazon, it is literally taking over...January 4, 2020
All the Details that You Need to Know About Steve Martin’s Beverly Hills Estate that He Listed for $2.149 Million
The award-winning banjo player Steve Martin is selling one of his beloved homes in Beverly Hills, California for $2.149 million. He...January 4, 2020
How Will Americans Be Affected By the Shutdown Of the Government?
Early on Saturday morning, the Congress failed to meet a deadline for funding a major portion of the federal government and...January 3, 2020