5 Ways to Improve your Credit Score – Having a good credit score has a big impact on your ability to acquire credit. This can affect your ability to rent or buy a house, getting finance for your business or buying a car. Knowing how to improve your credit score and taking active steps towards achieving a good credit rating has a big impact on your ability to live a normal life.
1. Get a Copy of Your Credit Report and Dispute Errors
TransUnion offers consumers a free copy of their credit report once a year. Get a copy of yours and go through it with a magnifying glass in order to spot errors. If you can prove that an error has been made, you have the right to have it removed. Even a small error can affect your ability to acquire debt.
2. Don’t run your credit cards close to their limit
The closer you run to your credit limit, the higher your credit utilisation limit, the higher your credit utilisation ratio, the more negatively affected your credit rating. Experts recommend that you don’t run your credit cards higher than 30% of the available limit.
3. Manage your Payments
Don’t be 30 days or so late on any payments. This will help prevent your credit score from being affected. Paying more than 30 days late can result in you being listed as a slow payer with the credit bureaus.
4. Keep your Accounts Open
Don’t close accounts. The age and payment history on your accounts can have a positive impact on your credit score. Use your older accounts for small amounts and pay them back quickly – this will result in you being recognised as a good payer.
5. Use “Good” Types of Credit
Timely payments on mortgage and auto loans shows stability and good payment history with “quality” types of loans. Stay clear of consumer debt as it is not associated with wealth building and the interest rates are high, negatively impacting your credit score.
Are you currently struggling to get vehicle finance due to a low or bad credit score? See our long term car rental or rent to own car leasing deals and call us on 011 262 5500 to discuss the ideal option for your budget and needs.