5 Credit Building Tips for People with Low Scores
(FinancialHealth.net) – Credit scores are incredibly important, and it looks like more people in the US are learning how to take care of theirs. According to a new report, the average credit score is rising. Not quite among the ranks of those seeing an increase? Here’s what you need to know.
Experian’s 2019 Consumer Credit Review found the average FICO score is now 703.
FICO scores can be anywhere from 300 to 850. The higher the number, the better your credit. While 703 may seem high enough for your needs, it could be better. Lenders give the best interest rates for auto loans to people who have scores above 720; the best mortgage rates go to people with scores higher than 760.
It’s important to note that a higher national average means more people are taking better care of their credit, but the average score means little for individuals. You have to pay attention to your personal credit.
Try these five tips to improve your score:
- Download Credit Karma or a similar app to keep tabs on your credit.
- Pay any derogatory marks on your report (or set up payment plans if you can’t pay all at once).
- Make payments on time, especially on debts like auto loans.
- Apply for a secured credit card, which can help you build credit without adding any risk to your current score.
- Keep your credit usage ratio under 30%.
Take the right measures, and you should be on your way to a healthy credit score. Just remember, consistency is key. And with the new FICO 10 models coming this summer, it’s more important than ever to gain and maintain good credit if you want to get that loan.
~Here’s to Your Financial Health!
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