When you are dealing with credit there is a lot that can happen to fluctuate but also lower your credit score. With 850 being the highest score you can possibly achieve, and 740 is considered a great score, there is a desire for many Americans to achieve the highest score possible, but reaching that point requires living a lifestyle of discipline and paying off your debts.
If you have debts on your name that you frequently don’t pay on time, or you struggle to make payments, then you are going to have a lower credit score than what you are aiming for.
I have advice on how you can repair your credit, but while repairing your credit is a big step, it can be even more difficult to achieve a high credit score. Once you get your score high it can be even harder to keep it there.
If you need help and/or advice with ways to keep your credit score at a high level then you can always seek out advice from Shamika Saves. I have years of experience helping people reach their desired credit score, getting out of credit debt, and understanding the value of a great credit score.
How To Get Out Of Debt
The first step towards earning a higher credit score is to get out of the debts you are currently in. This means that if you have overpaid utility bills or credit card bills then you need to seek out ways to pay them off. A lot of time this means coming up with a payment plan of some kind and in some aspects adding a lifestyle change.
You don’t have to live in credit debt and it is important to understand your rights so credit debt collectors can’t harass you. Understanding this will make the credit repair process easier and less stressful. Eventually, as you pay off debts, your credit will clear. You will be on the way towards positive credit.
It is worth noting that loans such as mortgages or car payments do not have a negative effect on your credit unless you are late paying them. These kinds of loans are considered “good debt” because they add to your credit score as you pay them, but just be sure to pay them off on time.
How To Continue A High Credit Score
Once you have finally freed yourself from the demands of credit debt you can begin working towards an even better credit score above 740. Lucky for you your first steps will have already been taken simply by paying off the initial debts on your name. As you pay off those debts your credit score will rise.
For some people, by simply paying off their debts and reaching a point where the only loans on their name are car and mortgage payments they will have already reached an average credit score. If you talk to me I may be able to see if you are someone where this could happen.
The next step will be raising your current score. If you have a history of bad credit this may be more difficult, but the process of raising your score begins in making payments. There are programs that exist where you can add utility payments to your credit score name. This won’t happen naturally, but I may be able to point you in the right direction.
Another way is to spend with credit cards you own and then paying them off on time. For example, you can open up a credit card and exclusively use it for groceries and gas. When you pay this off at the end of every month it will help you build up your credit score. Paying bills on time is one of the best ways to build up a positive credit score. If you feel comfortable opening up more credit cards then you can always do that, but make sure they’re for services you actually use and frequently spend in. Just opening up credit cards to open up credit reports will not raise your credit.
Keep Your Credit Score High Consistently
Experts point out some concepts to remember when forming the strategy. Usually, successful techniques rely on getting your FICO credit reports from the three major credit bureaus beforehand. Without these, you’re not going to get a good view of the challenges you’re trying to address or the places that represent the best opportunities to raise your FICO credit score.
After that, if you begin with a low score, you’re more likely to see a major change in your credit score and see it sooner. That’s and you’ll have more room for growth, and there could be a greater effect on minor improvements. But remember, don’t be disappointed if you don’t see all the change you’re looking for straight away, it’s a long game to raise your credit score. That being said, some tactics certainly have a quicker effect on your score than others.
Don’t Max Out Your Credit
Although you expect your credit rating to be high, you want to reduce your debt utilization ratio. That ratio measures the percentage you pay on your current credit. Think about it this way: If you have a $2,500 credit limit and spend $1250 before paying the bill for that specific period, that’s a 50 percent debt utilization ratio.
But, not using credit frequently does not help at all, because you’re not developing a track record of fair use of credit. Using 30 percent of your available credit is usually a safe and healthy financial choice that makes sense.
Some tips for keeping that ratio low are here:
Request more credit. If your credit limit increases but your expenses remain about the same, then your debt-usage ratio will drop.
Frequently pay your debts. Instead of racking up a bigger bill, you pay every month, you could pay multiple times a month in smaller periodic payments. This keeps down the balance reported by your card issuer to the credit bureaus.
Go onto your card easily. A simple way of keeping that credit utilization low is to reduce how much each month you charge.
It Can Take Time
If you have a credit history of payments frequently going to collectors that is going to stay on your report for at least seven years. So no matter how much you improve your bill-paying habits that late payment will continue to be there. If you want to quickly increase your credit score you can do that by paying your bills on time, but it will not be perfect until seven years have passed since your last late payment to reach collection.
Do not let this frustrate you though. Use that time positively and spend those seven years building up your credit. Once the seven years have passed you will not only have a clear record, but seven years of positive spending habits to go on your it.
The Value Of A High Credit Score
So what is the value of a high credit score? For starters, loan requests will have far lower interest rates. So if you ever need to take out a largescale loan for any particular reason the interest on it will not be quite as overwhelming as it might be.
This applies to areas like future car purchases, the mortgage for your home, or just trying to get an apartment or house for rent. Some places will not do business with you if your credit falls to a certain level. Others will only work with you if you accept a ridiculously high-interest rate. When you have excellent credit you won’t face as many issues when trying to make these kinds of purchases. In many cases, you will be first in line and get first pick.
This also applies to areas like your insurance. A high credit score can mean insurance that costs you less in some capacity, such as car insurance, but this can change depending on the previous history. Generally though if you have a good credit score then your insurance payments are less.
At Shamika Saves I help you better understand the credit raising process. I can give you advice on what steps you should take to raise that credit score from a good to an excellent. I will teach you about what happens when you don’t pay your bills. Obviously it will eventually impact your credit score, but how exactly does it impact it? What process goes into forming your it? I can answer any questions you may have about that. I can teach you how to look at your personal situation and raise your credit score to an area you didn’t think was possible.
If you want to raise your credit score from good to great or even excellent then call me today at 407-930-9570 or send me a message online to schedule a consultation. I want all of my clients to feel the incredible benefits of not just a positive credit score, but an excellent one. When you reach that mythical 740 number you will be shocked at how much changes in your life. Payments will cost less, applying for loans will be easier, and you will never feel any concern when you requesting a car payment, rent, or mortgage ever again.