Build Your Credit
What’s a Good Credit Score?
Credit Scores are like report cards for grown ups. It’s a 3-digit “grade” you obtain on a scale ranging from 300 to 850. It indicates your “creditworthiness” to potential lenders, banks, landlords, insurance companies and even to some employers. Definitely the higher you score, the BETTER.
Here’s what Credit Scores can mean for our personal finances:
- 300-580 – Credit denied, or offered very high interest rates
- 581-650 – High interest rates offered
- 651-710 – Credit offered at moderate interest rates
- 711-750 – Competitive interest rates
- 751 + – Credit offered at most competitive & lowest interest rates
What’s a Credit History
It is the credit information that is collected by major credit-reporting agencies, showing how you have used credit and whether you pay your loans and bills on time, as reported by your lenders.
There are many ways to help build a good credit rating. It is a measure of how good you are with money. Here are some day-to-day practices to establish and maintain a good credit rating:
Pay your bills on time.
Avoid the expense of late-fees and other unnecessary charges. Online banking is a great help to stay organized. Creditors are looking about your on-time payment history.
Make regular payments.
If possible pay your card in full each month or pay more than the minimum amount set. You don’t need to carry a balance to build a remarkable credit score.
Know what you owe.
Be conscious of the amount of all your debts and set a repayment schedule.
Do not spend beyond your personal limit.
You don’t have to consume your maximum credit limit.
Keep your account out of collections.
Don’t ignore calls or reminder letters. Stay on top of bills. Missed payments on credit can put you at risk on your credit history. If you can’t make full payments, talk to your creditors. You can make some kind of arrangements to settle it that may not harm your credit build up.
Find a co-signer.
The co-signer must have a strong credit history. When a co-signed load is granted, it does not only reflects on the borrower’s credit report but as well as the co-signer’s. If default payments, both credits will suffer.
Get a good job and keep it.
Employment history is a good indication of your capacity to repay credit. When applying for mortgage, salary history is one of the most important requirements that lenders will judge. Usually will be asked to present income tax for for the past two years and current pay stubs as proof of earnings.
Those who have a extra money, put that money into a short-term investment. It does show proper handling with money and seriousness to save. Definitely looks attracting from a lender’s perspective.
Make sure your monthly statements are correct.
Ensure to review your monthly statements to avoid unnecessary mistakes, quickly detect any errors and identify unauthorized use of your credit.
Once credit is granted, use it carefully.
Use credit wisely to be able to get the trust in securing larger forms of credit such as car loans or mortgages.
We understand that your credit situation is unique, and we have the right people on our Financing team to help you get the best vehicle at the lowest possible rate.
Start small, ensure to save more than you spend and remember what you do with your credit shows up on your credit reports. Use your credit responsibly.