Ways to Improve Your Credit Rating
A bad credit score can be a huge hurdle between you and loans. Most lenders require their borrowers to have decent if not perfect credit ratings which prove that a borrower is a responsible one who will in most likelihood repay his loan on time.
However, not every time is a good time financially for us, and sometimes we may take a few days or maybe weeks extra to repay our loans; that unfortunately, shows up on our credit histories as a bad one.
If you’re one amongst those who possess bad credit scores, here’s how you can improve your rating thus allowing you to get funded that too with better deals in the future:
1) Take Higher Credit Limits
Credit limits come with credit cards, which are given by banks to their borrowers. The lesser amount one uses within a credit limit, the better his credit score becomes. Banks help improve the credit scores of those who use a maximum of 30% of their credit allowance, since that goes to show that they are financially more stable than those who use an excess or the full amount of their credit limit.
Take for example your credit limit is $2000; if you usually use up around $1000 out of that, you use %0% of your credit limit which is good but not ideal to help improve your credit rating.
If you however, manage to request for more credit and get approved for the same, and then still use only $1000 say out of $3500 (consider this your new credit limit), then your credit score shall improve considering the fact that you’re using less than 30% of the credit allowed on your credit card.
2) Take a Payday Loan
Payday loans can make for dicey options if it seems hard on your pocket when the time to repay your loan comes. However, they can majorly benefit you if all you’re looking at is improving your credit rating and have enough in your wallet to be able to repay a payday loan (which is meant to be repaid in lump-sum) without a hiccup.
It is well-known to all that once you repay a loan, your credit score increases or decreases depending upon when you repay it i.e. whether you repay your loan on time or not.
Since payday loans are meant to be repaid all at once on a date that’s not far away, and you manage to repay the loan on time, your credit score shall undoubtedly increase. This is one of the fastest ways of improving your credit score.
Also, you don’t have to take a loan of say $1000, you can just take a loan of a minimum amount and repay that small amount when the time comes, so it isn’t stressful for you in any way.
3) Pay Your Debts on Time
The best way to avoid having a bad credit score, or even to improve your credit rating from a bad one to a good one is undoubtedly to repay your loans on time. A delay in repayment will always cause you to end up with a bad credit score.
In order to avoid possessing a bad credit score, it is advisable that you take an amount from your lender, only as much as you can easily return. In order to do that, it is important for you to take not only the loan amount but also the interest rate into consideration, calculate the same and borrow as much as you can repay.
In the Following Situation, Borrow an Installment Loan
If you need an amount more than what you can repay in just a single installment, try looking for a lender who will be willing to provide you with installment loans over payday loans, since that way you will have to repay the same amount, but over the course of a few months. But, keep in mind that you should take a higher amount only and only if it is really necessary to do so. For example, if it’s for an occasion or a festival, try to limit your spending. However, if it is for something truly necessary or important like funding a medical emergency, taking a higher amount can be helpful in such a situation.
Lenders like us at InstallmentLoanz provide installment loans that are easy and affordable to repay. Unlike payday loans, you don’t have to repay them as a whole on your next consecutive pay date which makes it fairly easy on the pocket, and doesn’t lead you to get trapped in a debt cycle.