If you're making any type of large purchase that requires a loan such as a home or a new vehicle, your credit score is going to be pulled. If it's on the low side you aren't going to qualify for a good interest rate or may not qualify for the loan at all. Improving your credit score is imperative to help you qualify for a loan so you can have the home of your dreams or the car you need to get you from A to B. Read on for credit score repair tips.
Write Out Your Debts
Write out all of your debts and your income to figure out your debt-to-income ratio. If you have too many debts and not enough income, you are going to either need to find another source of income or more income. If this isn't possible, you'll need to do something about your debts. Find out about debt consolidation programs to consolidate some of your bills such as credit card debt and make one smaller payment rather than multiple payments. A debt consolidation company may also be able to negotiate a lower interest rate on your debts as well.
Pay Attention To Due Dates
Pay closer attention to the due dates on your bills. If you have been paying your bills late it's going to show up as a negative mark on your credit report. Pay attention to when the bill is due and always pay it on time. Also be sure to always pay the right amount that is due. Paying less is going to show up as either paying late or missing a payment.
Pay Collection Debts
If you have anything in collections, these are the debts you should be paying first and foremost. These have most likely already been reported on your credit report and is showing up as a negative mark. Pay this off and then ask that it be removed from your credit report.
Open A Savings Account
If you have any money to spare, open up a savings account and start putting some money into it. Your bank also reports to the credit bureau, so having a nice amount of money in the bank is going to improve your credit score as well. Don't let your bank account get too low or negative that you're bouncing checks or payments.
Applying for a loan can be a bit daunting. You want to qualify, but you really want to qualify for a good interest rate so you can afford your loan. Clean up your credit report before applying for a loan. If you need assistance with this, hire a professional company that can help you so you can get the house you want.
