How To Maintain A Good Credit Rating
Before the 2008 credit crunch, many people in the UK have relied on their credit cards to pay for virtually everything they want and need. A lot of these individuals were also randomly offered credit cards by several banks without ever being questioned of their finances, principally credit card payments. This has made credit card consumers complacent and passive about their credit card usage.
With banks and lenders now more stringent, granting of credit cards and other forms of loans now takes longer and tighter. As a result, acquiring a mortgage, a personal loan, and even a credit card can be challenging for people at the moment.
To have a good credit rating, you should be alert with your records, receipts and documents that involve your loans and credit card.
Keeping track of your credit record is the first major factor whether lenders should grant you a loan or not. Your trustworthiness as a good borrower all boils down to how your credit record looks.
Your credit report is sort of a reference of everything you loaned, how much you borrowed, whom you borrowed, etc. so you need to check it consistently and make certain that each and every element is correct, up to date, and in accordance with your payments.
The most important thing to look out for on your record are the balances that you have previously paid but are still indicated as unpaid. It’s important to tackle the matter as quickly as possible as it will not only cost you more on your payment, it will also make your credit rating suffer.
Trivial errors on basic information such as your name, address, telephone number, or something else that is contradictory, should also be addressed with your bank/lender.
If you are moving residence, changing or cancelling your utility charges on the house you’re departing from is also very important. This is to make sure that the next occupants (if any) will not be able to charge these utility costs on your name. Getting your post redirected is also essential to prevent interception of your mails by other individuals that can be used to steal your identity.
If you share an account with a better half (e.g. live-in partner, spouse, etc.) be sure to cancel the account if the two of you decide to go your separate ways. If you are always on time with your payments and your partner isn’t, your credit record could also be dragged down. This is what is known as a financial association.
If ever you end up in this type of position, you should have your joint account canceled and set up your own personal account. If the joint account still has a specific quantity of debt, one of you should shoulder that debt. Both you and your ex can still pay for the debt mutually but it should be integrated to only one individual account.
Lastly, have the financial association status erased from your credit report by informaing a reputable credit reference agency.
If you have never borrowed any manner of loan or credit, and it so happens that you are not a newly graduate who’s just starting up, you could have a hard time when you choose to get a loan or a credit card.
This is because you don’t have a track record to show lenders that you are a borrower they can rely on. If you want to start a reliable credit rating, you can start by applying for a credit-building card and use it to buy things that is within your means and not be delayed on your payments, and maintain this account for at least one year.
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