6 Tips to Repairing Your Credit History

 

 

Don’t Apply for Credit Too Often: If you know you have a bad credit rating, applying for countless credit cards and loans is a good way to make your credit record even worse. Why? Every time you apply for credit a credit check will be performed by a potential creditor. This leaves a record on your credit history that can put some lenders off: too many applications for credit can leave you look desperate.

 

Ditch Unused Credit Cards: Unused credit cards can cause problems if you already have a poor credit history because lenders typically look to see how much money as a total you could borrow. This is known as the ‘debt-to-available-credit ratio’ and the higher the amount of money you can access, the less likely you have of making a successful credit application. 

 

Pay your Bills: It may seem an obvious point to make, but paying all your outstanding bills promptly is likely to improve your credit record. So if you are behind with your mobile phone or heating bills, get them paid and up to date immediately.

 

Get on the Electoral Roll: This is crucial if you are looking to improve your credit history. Lenders like to know who they are lending to and know where they live: getting onto the electoral roll increases confidence with lenders that you are not going to simply disappear and leave any debts unpaid. 

 

Have Bills in your Name: Utility bills not only show prospective lenders that you have the ability to pay bills on time, they also show a fixed address, too. 

 

Take on Credit: This can be difficult with a poor credit record, but if you can get a small loan or other form of credit in place, it does increase your chances of successfully improving your overall credit history – provided of course you pay it back in time. The fact that you have managed to take on credit and repaid a debt will leave future credit providers optimistic about your ability to repay any debts further down the line. Please note that this last method really only works if you can afford to pay back the loan, if not, your credit rating is going to sink even further.