Having a bad credit score can affect your ability to get new credit cards or a car loan. There are, however, a number of things you can do yourself you improve your credit rating. Whether or not you have bad credit is largely determined by your FICO score which is the score that the credit rating bureaus give to your credit history. If your FICO rating is low then lenders may question whether they should loan money to you. On the other hand if you have a high score then lenders will be more comfortable extending you credit.
If you have bad credit or a low credit rating there are a number of things you can do to improve your score. First you should check your credit report by requesting a free copy and make sure there are no errors. Some of the things that you should look for are whether the balances are correctly reported and whether there are any late payment notices that are incorrect. If you find mistakes on your report you should contest them with the reporting agency and the credit bureau.
Some additional advice for those who are looking to improve their credit scores includes getting a credit card if you don’t have one. Because you credit score essentially shows how well you manage debt, then you need to incur some debt in order to have a good history. If you have never had an installment loan like a car, student or house loan, you might consider getting a small personal loan to repay over time. Once you have a credit card and/or an installment loan, make sure that you make all of the payments on time. If you have an old credit card, don’t close the account even if the interest is high. A long history of credit is important to having a good credit score. Another piece of advice for bad credit is to make sure that your credit card company is reporting your credit limit. It may look like you are maxing out your card every month if your limit is not reported.
Don’t let you bad credit discourage you, you can take control of your credit score and improve it with these simple tips.