Did you know that only 21 percent of adults in the United States of America check their credit on a monthly basis? It is important to build credit in order to secure loans to purchase a home or a vehicle. Building credit might seem like an insurmountable goal but it doesn’t have to be that way.
There are multiple ways to build your credit and get it into a healthy place that will get you better interest rates on future loans. The good news is that you’ve come to the right place to learn about three great ways to improve your credit.
Keep reading this article to learn how to build credit today.
1. Don’t Miss Payments
Odds are that you’re making payments on at least one thing each month, whether that thing is a credit card or a car or mortgage payment. Perhaps it is even a utility bill. Regardless of what it is, one of the most effective ways to boost your credit is to make sure that you make all of your payments on time.
This means avoiding missing payments by periods longer than 29 days. If you’re consistent with this over a long period of time then you’ll notice that you’re starting to improve your credit. This will pay a ton of dividends down the road that makes your life much easier. Make sure that you know what is credit score and why it is important.
2. Get Your Past-Due Accounts Caught Up
Another great way to build your credit is by finding all of your accounts that are past due and paying them off. A big thing that affects your credit score is the amount of outstanding debt you have in your name. Late payments stay on your credit score for a long time, but getting your accounts caught up will still make a big difference to boost your credit score.
3. Limit Applying for New Accounts
You should also make sure that you limit yourself when it comes to applying for new accounts and lines of credit. Each additional line of credit or account that you set up puts a significant dent in your credit score. Opening new accounts also impact your credit score because it will change the average age of all of your accounts.
Between the credit checks that come with setting up or applying for new accounts and the change in the age of your accounts, you’ll do your credit score a lot of damage by doing this. Make sure that you limit yourself to opening only the accounts that you need in order to get by.
Take Measures to Build Credit Today
There are tons of benefits to getting started with building credit. One of the best things to do when you’re starting on this journey is to limit the number of credit accounts you’re applying for in order to build credit. You should make sure that you pay off any past due accounts that you owe money on and take care of all of your bills on time.
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