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I am not going to lie – my credit rating is currently quite shocking. I’d always prided myself on having an awesome credit score – I was always the one out of the couple with good credit but as the years have gone by and we’ve had unexpected expenses and things happen, my credit rating has taken a right battering.
This obviously isn’t great considering we want to get a mortgage in the not too distant future. Getting a mortgage will already be fairly difficult due to the fact I am self employed – at least I will have three years of books made up by the time we eventually apply for one and hopefully Steve will be in full time work at a local school alongside his studies to become a teacher.
Noticing how bad my rating is, I’ve been looking into some ways to boost it and get it back to fighting fit. Do you know of any ways to boost your credit rating?
Register on the electoral roll
If you want to get credit in the future, your name needs to be on there otherwise it can prove incredibly difficult.
Check It Regularly
This may sound incredibly silly but checking your rating regularly is very important. Whilst it is a little unlikely, sometimes things appear on our reports that are wrong and if you aren’t checking your rating often enough, it could be a while before you notice them and get them removed. These mistakes can have a big impact on your score.
Pay on time – and avoid defaults and CCJ’s.
Paying on time is vital – and whilst it can sometimes be inevitable that a bill gets missed, try to get back on track before you end up with a default or a CCJ on your file.
Consider a credit building credit card
Something most people consider when they have a poor history is getting a credit builder credit card from a provider such as Vanquis. Something to remember is that the interest on these will be slightly higher than other cards but these are great for building up your credit as long as you remember to pay on time.
Reduce your debt
Finally and perhaps the most obvious – reduce your debt. By cutting down on your debt, your credit score will increase. Find innovative ways of cutting down on your debt – take on more hours or do overtime at work, sell off anything items in the house you no longer need, do some side hustles to bring in some more money and apply every penny to your debt. Make a budget and stick to it, throwing every single extra penny at debt. Meal plan – this is something we have started to do again and one such item on the menu is this Instant Pot Pork Chops I found on Recipes From A Pantry.
Try and pay much more than the minimum payments each month and your balance will soon be going down and your credit rating up. One thing to remember though is to not pay everything off in one go – I recently found out that if you pay everything off in one go and have no credit at all, it can have a negative effect on your credit score for a while afterwards before rising again. We plan to reduce all our debts down to a certain amount each eventually and to then pay the minimum payment on each (of about £5) until they are paid off – so they all get paid off at different times. We will then keep one card for emergencies – maybe get it turned into a joint card.
Do you have any tips for increasing your credit score? I’d love to hear them!