June 24th, 2015 by Jason M. Kaplan, Esq.
3 Powerful Methods to Improve Your Credit Score
Ever since the subprime mortgage crisis hit the United States, financial institutions have become vary of credit ratings and credit scores. Before the turmoil, banks and other financial institutions were all too happy to lend out money to people who had below par credit scores. Thus, when the time came for people to repay their debt, disaster struck. Therefore, the importance of credit scores and ratings for both banks and their customers have increased massively. Despite the stringent checks put in place, a lot of people still have low credit scores which means that these people are more often than not turned away by financial institutions.
Thankfully though, turning your credit score around is no rocket science. With the 3 powerful tips mentioned below, you can easily make your credit score look much better.
1. Get rid of Small Balances:
Today, a lot of people tend to use multiple credit cards for various purposes. However, this means that the owner of the credit card has his or her finances divided among all these cards which invariably leads to more than one card used for what would otherwise be a single transaction. For instance, if a person uses one credit card to pay $40 and the other to pay $20, then the credit score could be hurt as there would be small balances left on multiple cards. The trick, therefore, is to get rid of the small balances on your cards and then preferably use a single card for all your needs.
2. Pay your Bills on Time:
Perhaps the greatest factor that leads to low credit scores is the inability of the credit holder to pay the bills on time. To get around this problem, always ensure that you pay your bills on time, month after month. In some cases, people tend to sit on savings and delay paying their bills and this leads to a damaged credit score. Even though there is nothing wrong with saving money, delaying payments to save money is not something financial gurus recommend.
3. Transfer your Balances:
When it comes to credit scores, your business will be judged on its ability to have a good credit rating. The way around this issue is simple. If you have a credit card for your personal use that has a high balance and a credit card on the name of your business which has a low balance, transfer the higher balance onto the business card.
Watch Jason Kaplan explain how transferring your balance improves your credit score and ultimately helps you benefit from lower interest rates and improved borrowing power:
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