It really don’t matter how your credit rating got into such bad shape, the fact that it is in bad shape means you have got to do something about it. In our world bad credit can do a lot more than just deny you any more credit. It can stop you from getting an apartment to rent and even some jobs. There are a lot of employers out there who don’t employ people with bad credit. In their mind if you are not responsible at home with your finances you will not be responsible at your place of work either. An overreaction? Yes, but it is the reality. What can you do to improve your credit rating? Before you do anything you have got to realise that this is not going to be a fast process. Depending on how low your score is it could take at least six months. It could take more than a year if you are lower than 500.
Normally your credit score will be based on three main points.
- Payment or Non payment
- Your number of credit sources
- The number of creditors
With these points you can see two things. Firstly you need to make all of your payments on time or early. And your credit sources should outnumber your creditors. So this means you have to be able to get money from more sources than you owe money to.
Two ways that you can build up your credit faster than normal is to take out payday loans, or logbook loans. Payday loans can be particularly good because they are small and quick. Not only do you pay the loan back in a single payment, every payday, and you get points towards your credit every time, but every payday you get credit for paying off a full loan. On the other hand a logbook loan is quite a bit larger, but you can consolidate your debt into one loan with these.