Where to Start When Improving Your Credit Score | St. Johns Bank
If you have set yourself up with the goal to improve your credit score, we commend you! While your credit score may seem like an arbitrary number to your daily life, when it comes to securing financing or loans, it is actually an extremely important factor.
Credit scores range from 300 to 850, and the higher the number, the more favorably lenders will see you.
Unfortunately, many people struggle with a perpetually low credit score. There are plenty of things that can reduce your score, and once it dips, it can be difficult to rebound it to a good level—but not impossible!
If you are hoping to improve your credit score, take a look at the things you can do to improve it.
Actions that Improve Your Credit Score
Making your payments on time. The single most important thing you can do to improve your credit score is making all of your monthly payments on time, every time. This includes your payments for utility bills, student loans, car loans and credit card bills, as lenders want to see that you are paying back the money you owe on a consistent basis.
Paying down any high balances. The amount of money you have borrowed at any given time is also something that lenders will be looking at closely. Having a high amount of money borrowed can ding your credit score, so paying down your balances can bring your credit utilization down to a level where it helps your number.
Opening a new account type. For most people, their first experience with an activity that can impact their credit score is taking out student loans. However, your credit score is impacted by the mix of credit you have—for example, if you currently only have a car payment, opening a credit card can be favorable. Having multiple types of credit that you make payments on can show that you are actively managing your money.
Keeping old accounts open. The length of your credit history is also factored into your credit score, so keeping old credit card accounts open can be a smart choice. As long as you have nothing auto-charging to the card and do not have an outstanding balance, you can safely shred the card but the account will still be marked as active, which can increase your length of borrowing history.
If you need help getting your finances in order, get in touch with us! We have a variety of accounts and personal loans designed to help you get ahead. Contact us today for info!