Keeping your personal credit score in good shape should not just be a part of the New Year’s Resolution. It should be a regular regimen that everyone must follow. On this post, let’s take a closer look at the specific steps that you can do to build and maintain good credit.
Monitor your personal credit report. Consumers have the right to receive one free report from each major credit bureau (Experian, Equifax, TransUnion) once each year. You can request your free report at www.annualcreditreport.com, the only resource authorized by the government to distribute free credit reports. You can request all your three reports at once or order one copy from each bureau at different times throughout the year.
If you plan to apply for a new credit card or a loan at any time soon, it is recommended that you check your credit report prior to submitting your application. Thus, you can have the chance to correct errors in your report by sending a letter of dispute to the bureau that issued your credit report. The process of disputing errors can take up to 30 days to complete which is why you need to check your credit report at least a month in advance.
There are other instances when consumers are allowed to request for their credit reports for free such as if you are unemployed and plans to search for a job within the next 60 days, if you have been denied credit, or if you think you have been a victim of identity theft.
Pay attention to your due dates. Are you aware of all your payment due dates? It’s very important to pay all your creditors on time – whether it’s a credit card, a loan, or a utility service provider (cable, internet, electricity, etc). If you are currently in the middle of your mortgage repayment, keep in mind that missing your home loan payments can lead to foreclosure. Hence, if you are experiencing financial crisis and will not be able to submit your payment on time, the best thing to do is speak with your creditor.
Don’t borrow more than what you can afford. Having a credit card brings a lot of convenience but it also involves serious responsibility. If you own a credit card, you need to be particularly aware of how you utilize your credit. Before paying with a credit card, seriously consider if you can afford to pay off your full balance on time.
Do not borrow short term loans unless it is an absolute emergency. Furthermore, you should consider if there are alternative solutions to your problem. Avoid taking out payday loans as much as possible since these loans carry very steep interest rates. If you fail to pay back the full amount of loan by your next pay check, you will be forced to pay 100% to 300% of interest rate.
Build up your personal savings. See to it that you have enough funds stored for the rainy days This way, you do not need to rely on private or commercial lenders for help during times when budget is tight.
STUDENT CREDIT CARD RESOURCES
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