If you rate your credit score as good, or even excellent… then fantastic !! 🎉
But … you’ll want to keep it that way. Here are four tips to help you improve even a great credit score and keep it that way …
Don’t take out a payday or short-term loan
Payday loans are a red flag to lenders and they are likely to cause your credit score to fall. 🚩
The credit reference agencies (Experian, Equifax & TransUnion) deduct points for payday loans because they see that as you having used a creditor (lender) of last resort.
One loan may not make much difference, but multiple payday loans over a short period will reduce your score. Be careful!
Maintain accounts, even if you don’t use them
Keeping lots of borrowing accounts up-to-date is good. Managing multiple commitments with payments on different days shows lenders that your are organised, committed and repay your debts.
But are your credit card balances gradually increasing? That could be a sign that you’re using credit to make ends meet.
Don’t move home!
Lenders love stability. 🥰
Knowing that you are staying where you live makes it easier for them to stay in contact with you. They see you as less likely to run off without paying your due.
You don’t have to also own your own home but if you do, that will increase your credit score even more.
We get it. It’s not always possible or desirable to stay living at the same place – let alone buying your own home!
But it’s our job to let you know how they think and make decisions.
Be careful taking out new loans
A new loan, just taken out, will reduce your credit score in the short-term. This is because you have not yet shown you can afford this new commitment.
The reduction in score can be significant – and costly. If you’re in the process of buying a new home with an in-principle mortgage offer – then you could find that withdrawn if you suddenly take out a loan!