Much as it may appear counterproductive on the
surface, strategic use of debt can actually be great for building a strong
credit score. As far as the major lenders are concerned, there’s only one
realistic way of gauging an individual’s financial responsibility.
surface, strategic use of debt can actually be great for building a strong
credit score. As far as the major lenders are concerned, there’s only one
realistic way of gauging an individual’s financial responsibility.
That being, to see how they handle debt.
Hence, if you have no real credit history whatsoever,
pretty much the only way of getting
things moving in the right direction is to take on some form of sensible
debt.
pretty much the only way of getting
things moving in the right direction is to take on some form of sensible
debt.
The same also applies for those with flawed credit
histories, which can make it uniquely difficult to qualify for loans, credit
cards and other everyday financial products.
histories, which can make it uniquely difficult to qualify for loans, credit
cards and other everyday financial products.
A Question of Accessibility
One of the most appealing characteristics of a secured
loan is its accessibility. Depending on
the size, nature and intended purpose of the loan, it’s often possible to
qualify without undergoing a credit check. Even if your credit history is
anything but ideal, you’ve still
every chance of qualifying.
loan is its accessibility. Depending on
the size, nature and intended purpose of the loan, it’s often possible to
qualify without undergoing a credit check. Even if your credit history is
anything but ideal, you’ve still
every chance of qualifying.
This is precisely why secured loans
can be very useful for improving a damaged or absent credit score. Just
as long as you’ve sufficient collateral to cover the cost of the loan, you’re
almost guaranteed to be accepted. Assuming all repayment obligations are met,
this will be noted on your credit report in the form of an improvement to your
score.
can be very useful for improving a damaged or absent credit score. Just
as long as you’ve sufficient collateral to cover the cost of the loan, you’re
almost guaranteed to be accepted. Assuming all repayment obligations are met,
this will be noted on your credit report in the form of an improvement to your
score.
Of course, the extent to which a secured loan improves
anyone’s credit score will be determined by a variety of factors. The current
state of their credit score at the time, the size of the loan, the type of
loan, its intended purpose, repayment terms and so on. Almost every secured
loan can have a beneficial impact on the applicant’s credit file, but the
extent of the improvement varies from one case to the next.
anyone’s credit score will be determined by a variety of factors. The current
state of their credit score at the time, the size of the loan, the type of
loan, its intended purpose, repayment terms and so on. Almost every secured
loan can have a beneficial impact on the applicant’s credit file, but the
extent of the improvement varies from one case to the next.
Building a Better Credit Score
Whether your credit score is exceptional, average or
downright awful, there are steps that can be taken to improve it. Building a
strong credit score takes time and effort, but the sooner you get started, the
quicker you’ll get there.
downright awful, there are steps that can be taken to improve it. Building a
strong credit score takes time and effort, but the sooner you get started, the
quicker you’ll get there.
The most effective options for building a better
credit score being as follows:
credit score being as follows:
- Eliminate
as many unnecessary debts as possible, rather than allowing their balances
to tick over on a month-by-month basis.
- If
possible, reduce the balances on your credit card so they’re nowhere near
their respective limits.
- You
could also think about completely getting rid of any credit cards you
don’t need and no longer use.
- Avoid
applying for any credit facility if there’s a chance your application will
be rejected, which could inflict further damage on your credit report.
- If you’re
struggling with multiple debts, speak to a broker to discuss consolidation
options and prevent further damage to your credit score.
And of course, the importance of carefully considering
your financial situation before applying for a secured loan cannot be
overstated. By submitting sufficient collateral to cover the cost of the loan,
your property is at risk of repossession if you fail to meet your repayment
obligations. – UK
Property Finance
your financial situation before applying for a secured loan cannot be
overstated. By submitting sufficient collateral to cover the cost of the loan,
your property is at risk of repossession if you fail to meet your repayment
obligations. – UK
Property Finance
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Excellent information on your blog, thank you for taking the time to share with us.
Reference:
https://homeia.com/5-actions-to-increase-your-credit-score
https://homeia.com/when-buying-a-home-make-your-credit-score-work-for-you