If you are like most people there are blemishes on your credit report – and your score may be preventing you from getting the best mortgage rate, car loan or rental apartment. The good thing is there are several ways you can improve your credit and start to see results right away.
The first step is to pull your report regularly so you can monitor your credit and make sure there aren’t any errors. Nearly 80% of credit reports contain at least one error.
Now, create your plan using tips from articles such as Credit Repair 101 and the report issued by the Financial Consumer Agency of Canada. Make sure your plan is obtainable. Like a fad diet that doesn’t work you want to avoid anything too drastic (ie/ eating only Mr. Noodles) and think more long term with every purchase.
Pay your bills, and pay them on time. Even if its just the minimum (though always try for more), its so important to pay your credit cards when you are supposed to, without using other credit cards to pay other credit cards.
As for credit cards, you need to have them. It takes responsibility to not max them out, to keep a low balance, and to pay them monthly – but they are important for building your credit. In the article Credit Repair 101 it recommends 2-4 cards.
If you are having problems and aren’t able to pay your bills, call your creditors. Honesty is often the best policy, and in this case probably your best hope for your credit score. Often creditors will work with you to develop a payment plan and avoid sending your file to a collection agency, which will tarnish your record.
So in summary; check your report for errors, put yourself on a budget, don’t rack up bills you can’t afford, pay your bills on time, keep a healthy credit report by using credit responsibly, and if all else fails and you need some help – ask for it!