High Credit Rating Guide

A good credit score is very important in a person’s life. This is because a good credit score determines your approval for credit in mortgages, installment loans, credit cards and car loans, the cost of your homeowner’s and car insurance, the rate you will get on your loans and in some cases, even the if you will get the job you were hoping for! So naturally, it is important for one to have a high credit score in life!

Get a High Credit Rating Score

There are some means to improve your credit score. First, you could order a copy of your credit score and review it carefully. If there are any significant errors, correct them. Make it a point to always pay your bills on time as late payments of bills lead to a lower credit score. It is always better to avoid opening a lot of new accounts over a short period of time, especially if you have a short credit history. Opening new accounts quickly induces the image of you not being able to handle your finances correctly. It is also not wise to open credit accounts you never actually intend to use! It is always better to shop for credit for over only a short period of time. This enhances your credit score. If at all you have a questionable credit history, it is better you own a few new credit accounts and use them responsibly while paying them off on time. This helps improve your credit score. Having a credit card or installment loan helps raise your credit score as long as you don’t leave too high a balance and if you pay off the loan in a timely manner. Try to keep your balance low in relation to your available credit. This means that if your credit limit is $10,000, it is advisable to keep your balance below $2,500 (25%). This actually helps to improve your score. Try to pay off credit card instead of moving them around to lower rate cards. This is because moving balances to other credit cards and them closing the old account may only hurt your credit score as it very much affects the ratio of your total credit card balances to your total available credit lines.

Just remember that negative items affect your credit score more quickly than positive items. While late payments may negatively affect your score in a few months, timely payments take up to six to twelve months to generate an increase in your credit score!