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Credit scores range from 300 to 900 and they help lenders, banks, landlords and more determine your creditworthiness. It is important to maintain a healthy credit score. Here are some tips to build your credit score.
Build Your Credit Score
Finding out your credit score is a great start. Reviewing your credit report annually can assure there are no surprises.
From your credit report you can see if there are any of the following.
Credit Items That You Are Missing the Minimum Payment On
This attributes to 35% of your overall score. These payments are usually quiet small and can be easily missed. A small credit card minimum payment or phone bill that you may be missing the minimum payment on can add up in lost points fast. Setting up an automatic minimum payment will help you build your credit score.
Suspicious or Fraudulent Items That You May Need to Report
If you notice anything suspicious or fraudulent on your credit report, it is important to contact the credit bureau company right away.
Debt Balances Owning That Are Close to Their Limit
A good goal to follow is to never have your balance owning at 50% of the limit or above. This will maintain your score. A balance at 75% or more of the limit will start to decrease your score.
Items in Collections
It is important to clear and collections up right away. You can pay them if owed or, contact the collections company to discuss any items you feel may be there in error. Plus, many lenders cannot lend to you while you have an item in collections.
Your Credit is Being Checked Too Frequently
These credit checks cost you points and should only be done if really needed. This can affect you when looking to get a mortgage pre approval.
Learn more: Ottawa Mortgage Pre Approval
You Have the Right Amount of Credit Items
It is best to have two sources of revolving credit that you are using monthly. Many lenders would like to see two credit items. Also, that have been in place with a positive history for at least two years.
Learn More: How to Build Your Credit on YouTube