10 Tips For Managing Your Credit Report To Improve Your Score
Poor credit doesn’t have to be a permanent thing. Taking a few simple steps now can help improve your score over time. Don’t think your credit score matters? Good credit scores lead to lower interest rates on everything from mortgages to auto loans to credit cards. Lower interest rates mean more money in your pocket to spend on the things that are important to you.
Check out these 10 tips from our credit report partner, Vantage, and the different ways Member’s First can help you each step of the way.
Establish a credit report
Your credit report provides the financial reference creditors need to make lending decisions. The report’s content is used to calculate your credit score.
If you aren’t sure what your credit report looks like, take the time to look it up. Anyone can get a copy of their credit report for free at annualcreditreport.com.
Always pay on time as agreed
Late payments are the first signs of impending credit problems. When you pay late, it’s harder to get credit.
MFCU offers great services like direct deposit and weekly, bi weekly or monthly payment options to help you pay your bills on time. You can even pick if you prefer payments taken from your account on payday or a specific day.
Have a mix of credit, but obtain and use a credit card
You decide how to use the card and repay the balance. That says more about how you make credit decisions than other types of accounts, such as auto loans or mortgages.
MFCU has credit card options with competitive rates that fit your lifestyle. Pay on the go with services like Apple or Google pay. You can even make your card payments right from your phone or computer with our mobile and online banking services.
Use caution when deciding to close credit accounts
Closing lines of credit, such as a credit card or home equity line of credit, reduces your available credit. That can increase your total balance-to-limit ratio, which is a sign of risk and can negatively impact credit scores.
Consult a knowledgeable MFCU lender before closing your accounts. They may be able to suggest an alternative solution.
Apply for credit judiciously
Recent inquiries indicate that you may have taken on new debt that isn’t yet shown as an account on your credit report. Many inquires in a short time might suggest you’re trying to take on large amounts of debt. Both issues signify risk.
Our experienced lending team is here to help you make decisions that could impact your credit. Big box stores may have tempting intro rates but taking the time to read the fine print and consult with someone who understands your financial situation may end up saving you money (and credit score points!) in the long run.
Time is the key
It takes some time for your credit report to be updated, so balances can’t be reduced overnight. And credit scores look not only at whether your bills are paid, but also at how long they’ve been current and how far in the past negative information appears. Your scores will improve after you’ve taken control of your credit, but it won’t be immediate.
Most credit bureaus report monthly—not daily or instantly. Be patient and keep making those payments on time. Over time, you will see your hard work paying off.
Lenders may look beyond your financial transactions and ask how long you’ve had your job, how long you’ve lived in the same location, and whether you’ve built other assets over time.
At MFCU, we are proud of the relationships we have with our members! When we know you and your financial situation, we are able to help you achieve your financial goals through solutions that are tailored to your needs.
Have a plan
Know how you’re going to repay the debt when you use your credit card or get a loan, and stick to that plan.
We can help you create a doable plan. We offer many convenient ways to pay your bills in person or online. We also offer automatic payment options so you never miss a due date again.
Put credit to work for you
Use credit as a tool to take advantage of low interest rates, convenient shopping, rewards programs and financial management. When you’re in control, credit works for you.
Check out the MFCU Rewards VISA! Get rewarded for shopping at the places you already shop most. We offer competitive rates and additional discounts, based on your standing and relationship at the credit union.
Share your knowledge
Share what you’ve learned about credit with you friends and family so they can avoid pitfalls and mistakes you might have made.
We are all learning together! Share resources like this one to help others achieve their 2021 goals. Also encourage friends and family to utilize our blog and website for other financial educational tips and topics.
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