How to Improve Long Term Credit Rating

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When making applications for mobile network contracts and get rejections, you’ll certainly seek alternative ways to solve your problem at hand. That is a short term solution. However, to ensure that you are not facing problems in the near future with your credit ratings, you’ll need a long term solution. That breaks down to improving your credit rating in the long term. You will need to show lenders that you can make responsible borrowing. Here are highlights of the things you can use to improve your credit rating in the long run.

Make payments on time

Always try to make timely payments. When you achieve to make payments on time, you are simply demonstrating to your credit providers that you are a responsible borrower. If you have a savings account for repaying debts, make sure the account is always accessible for preparation in times of emergencies. Prior to making payments on time, it is also important that you consider plans that are affordable to you so as to avoid payment delays.

Use credit building credit cards

Credit cards with a credit building option can really improve your credit rating. These cards work on simple terms. For instance, the credit card company will lend you £60 and you’ll sign a credit agreement where you will be making £5 monthly payments till the loan is settled fully. As the year comes to an end, your loan transactions with the prepaid card company will be recorded on your credit report as successful repayments for 12 months. That is as long as you didn’t miss a repayment at a certain month.

Take note however that prepaid cards have some extra charges. For instance, you might be required to pay £5 to obtain the card, a 2.5% charge on all your expenditures and a £1 charge for every top up you make. Always try to shop around for better deals offering lower or fewer charges.

Refrain from costly credit repair firms

There are several adverts revolving around that they can repair bad credit ratings. Most of these firms usually make negotiations with other firms that have filed County Court Judgements (Decrees as in Scotland) in your opposition. Some of these companies also claim to do things that they are not allowed by law while others may encourage you to make false statements to credit reference agencies. Never consider such firms as they will only drag you into deeper problems. In the first place, there is no reason as to why you can’t repair your credit ratings, hence there’s no point of paying someone highly to do it for you.

Get yourself on the electoral register

If you don’t exist on the electoral register, finding any type of credit can really be difficult if not impossible. Lenders usually use your electoral register information to prove your identity.

Get rid of all dormant credit cards

When you have unused credit cards, lenders usually include them in your credit rating assessments. What counts is whether there is any amount available for you in credit and not how much you are using. If there’s nothing for you, guess what can happen on your credit rating.