Credit scores are something that affects us all, and annoyingly, they play an increasingly important part in our lives. From wanting to get a new mobile phone contract to switching to prepaid electric meters, they are all assessed using your credit score.
While it can be annoying, there are some things that you can do, to pay close attention to your credit score, and figuring out how it all works, so that you don’t have to do anything about it.
What are the myths and what are the truths?
One of the myths around credit score is that a bad credit score is the bad news. It may not be good news, but there are certainly plenty of good things that you can do to help it to improve. You could look at a site like Repair.Credit, for example.
Looking at the best ways to repair your credit score will mean all is not lost. But there is another myth that you can’t get credit with bad credit. While it isn’t advised as rates are often higher, if you can make the repayments, then it can be a good thing to help improve your rating.
What are some of the other things that you need to know around credit score?
One of the misconceptions is that your credit score is only about if you’re able to make your repayments. Of course, this is a good idea, as you’ll be charged late fees. And a lender won’t want to loan you money if you clearly don’t have a way of paying it back.
But if they can tell from you that they could make some money off you (ie. you miss a few payments or only pay the minimum back), then they will be making money off you. So you do have to bear that in mind when applying for credit; do you really need it? Or will the banks be looking to make money off you?
Not everyone knows that if you want to apply for credit but are declined, then this does go on your credit report. This can put others off, as they will be able to see that if you apply to them. So if you are looking for credit, but your score isn’t the best, then it is worth checking your eligibility first. There are plenty of places online, like mbna.co.uk/eligibility-checker/, where you can enter your details and find out if it is worth applying or not. Take heed to the results, as you don’t want to unnecessarily add to your score.
Likewise, if your applications are inconsistent, then it is likely to lead to your application being denied. As the applications are all computerised these days, they look for odd patterns that could indicate fraud. So be consistent in your applications, and don’t leave anything out.
Your credit score, whether good or bad, can be improved. You just need to not bury your head in the sand, take charge with it all, and you will get it to where you want to be.
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