Credit score has become an integral measure in modern lives. This is a measure employed by employers, financial credit institutions and credit stores among others to determine the credibility of a potential client. It is one of the major aspects put into consideration when loans, services or goods are offered on loan to the client. Determination of the credit score is done through the clients ability o access financial assistance on credit and the ability to make the agreed payments within the desired time. Ability to pay in time increases the score while failure works in the opposite direction.
The first step in building a credible credit score is to have access to credit facilities. In order to build a credible score, the borrower needs to borrow only amounts that they can conveniently repay without any strains. However, having access to credit and failing to continuously borrow creates an indication of a responsible person and this as well increases the credit rating.
One of the factors that affect the ability to repay is cases of fraud a prevalent feature in lending. To avoid the disappointment that may arise from fraud, the borrower needs to keep checking their credit reports to ensure it is consistent with the amounts borrowed and repayments being made. In the event they occur, it is important for the borrower to raise the issue with the lender and sort the difference in place of failing to repay. The platform provided to solve the situation is through writing a letter of credit dispute to the lender and make a follow up to ensure it is received and effected.
Timing credit applications is an ideal way to avoid decreasing the credit rating. While it is possible to access credit from different lenders, the borrowers need to consider the timings to ensure they do not overlap. A hard enquiry that defines the application gives an impression to other borrowers of unsatisfied client and hence raising concerns over credibility. Where it must be done, the borrower needs to use the soft enquiry approach that does not reflect on the score ratings.
Making payments on time is a great way to improve individual ratings for the borrower. Options available to enhance this include sitting reminders on when every payment is due or using auto payment options from banks.
Borrowers do not require to treat credit as a source for better lives. In this way there is need to avoid over borrowing. Seeking for credit that is below the available limits is a sure way to raise individual ratings. With limited amounts to repay, the borrower gets convenience to repay and abide by the agreed terms without straining available repayment resources.