How to Build a Better Credit Record
You may have overlooked improving your credit record due to other more pressing concerns. But, if you’re experiencing financial troubles, building a better credit record is vital for accessing new credit with appealing terms.
Building a better credit record is quite simple:
- Take out small amounts of new credit or small loans and pay them back according to the terms of the agreement – on time and in full.
- Add new positive information to your credit record.
The negative information on your credit record will slowly disappear, as most harmful credit information remains on your record for a maximum of 7 years and 6 months. Over time, the positive information on your credit record will overtake the negative. Of course, this will only happen if you manage your debts responsibly.
Possible effects of a negative credit record:
- You won’t qualify for low-interest credit cards
- The bank won’t lend you a considerable amount of money
- It may affect your job opportunities as some employers run credit checks
- Your current employer may deny you a promotion
- Life insurance companies may charge you higher premiums or refuse to sell you more insurance
- Your rental opportunities may be affected as landlords run credit checks
You may be denied particular kinds of professional licenses or security clearances.