Awakening Africa Magazine

Finance

Did the pandemic ruin your Credit Score? Look at the 5 ways to remedy this situation

2 Mins read

Life is much easier when you have a good or maintained credit score as you get lower interest rates on loans and credit cards. Are you worried about your low credit card score and have no idea how to sort it out? It’s important that before you try to improve your score, find out why your credit score was reduced.

Don’t forget to give a read to the 5 different ways mentioned below for improving your credit score.

1.    Pay your bills on time

Don’t focus on what has happened in the past, as it cannot be changed. Instead, figure out ways on which you should adopt now. Paying your bills on time greatly improves your credit scores and shows lenders that you are punctual and organized. This way, they are assured that you will return their amount on time as well. To avoid late payments, you can make a payment schedule on your phone so that you can clear payments before time.

2.    Stop luxury spending

Are you one of those people who don’t think before spending all their money at the same time? If yes, then it’s about time you change your spending habits. While many people enjoy shopping as it serves as therapy, imagine the aftermath of spending all your money at once. Rather than spending on everything, make conscious choices about your expenses and make a monthly expenditure budget. This budget will help you restrict yourself from spending unnecessarily.

3.    Don’t throw away your old cards

When you close old accounts and throw away your old credit cards, it reduces your overall credit utilization. By keeping multiple cards, you will benefit from an increased credit limit and good credit history. This way, you will also be able to maintain your credit scores and get into the good books of lenders and the bank itself.

4.    Increase your credit limit

Before you go forward with this option, keep in mind that the rules and regulations have become strict since the pandemic, so you need to have a perfect credit score. If you have maintained your credit score until now, you can request a credit limit increase or apply for a new credit card. However, make sure that you don’t use too many credit cards as it could raise some red flags for the lenders and the bank authorities.

5.    Check credit report for errors

Were you aware that around 34% of Americans found at least one error in their credit report? Credit report errors are not uncommon like you might think, so it is always a good idea to check them. If you haven’t ever checked a credit report them some common errors include misreported payments, duplicated accounts, and payments that are recorded twice. If you come across any mistakes in your credit report, then your score will be improved immediately. Checking your credit report will also give you peace of mind that everything is well with your score.

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