If you’ve ever done any research on financial management, chances are you’ve heard about the importance of positive credit history. More than just 3-digit numbers provided by credit bureaus, these reports provide a lot of insight on who you are as an individual – especially as it pertains to money management. If you’re not taking the proper measures to keep your credit history intact, you could give off the wrong impression.
What does a credit history or score tell a lender or service provider about you?
Whether or Not You Can Handle Money
One of the first things your credit history says about you is either you can or cannot manage your money. A poor credit score with lots of delinquent accounts, collections, maxed out limits, and way more debt than income says that you probably don’t have a good handle on your personal finances.
How Trustworthy You Are
Lenders are taking a risk when they award funds to a customer. The hope is that the loan will be borrowed and repaid as agreed. A view of the credit report lets lenders know whether or not a customer can be trusted with funds. If there’s a loan on your history from years past that you skipped payments on, allowed to go into collections, or haven’t even repaid, you’ll be marked as high-risk and untrustworthy.
How Stable You Are
Your credit report provides personal identifying information including your address and place of employment. Creditors, lenders, and service providers can review this information to determine how stable you are. How do they know that if they provide you with the money, products, or services, that you’ll be able to repay what is owed without a wild goose chase? Obviously, for them, someone who has maintained the same job for years is a lot less risky than someone who moves around frequently.
What to Do About it?
No one wants to be viewed as irresponsible, unreliable, unstable, and untrustworthy. Especially when you’re trying to obtain things like a house, car, job, loan, or line of credit. So, how do you turn things around if your credit history paints you in a bad light? Below are a few brief tips:
- Get debts paid – You’ve got to get those balances down or paid off. You can use sources like MaxLend as good credit isn’t needed to obtain a small loan. Use those funds to knock out what’s on your credit history and, of course, repay the installment loan.
- Pay timely – Make sure that you’re paying all your bills on time. If you need a new due date, talk with service providers to try and change it to something easier to keep up with.
- Remove inaccuracies – If there is information on your credit report that’s outdated, or inaccurate, have it removed to clean up your image.
Credit is everything. It is used to determine a number of things including whether or not you can be approved for a mortgage to how much …