How a Credit Score Score Can Make All the Difference in Your Financial Life
At some point in your life, you may need to take out a personal loan or refinance . For your application to be approved, however, several factors are taken into consideration, and one of them is the level of your Credit Score, an important tool that shows how you handle your finances. A lot of people don’t even know it exists and end up being disappointed when their loan is denied.
What is Credit Score and how does it work?
We have already explained about it here, but it costs nothing to remember. Credit Score is a way for financial institutions to assess whether you are delinquent or not, whether you will be able to pay your bills and debts. It is measured according to your financial health: your monthly income, marital status, your debt history, whether you are employed or have a source of income, your drinking habit.
With this in hand, you end up being classified as a risk, which can be high, medium and low based on your score. These points range from 0 to 1000, and are super important when it comes to deciding whether to lend to you. After all, nobody wants to do business with someone who is not very organized in payment, is not it? Having a high score means that you are more likely to pay off your debts over the next 12 months.
Of course this is just a reference. Each company has its own discretion when analyzing the score of each customer. High values are not credit guarantees, and even low values mean you won’t make it. However, it is quite common – and even obvious, will – that those with better financial health will be more likely.
My credit score is low. And now?
Then you entered the site and found that it is considered a high risk. This happens when your score is below 300. The good thing about the score is that it is dynamic – that is, by changing your spending habits, you change those values.
1. Data Update
First, to increase, how about updating your registration data? Keeping this information up to date already makes a difference in your score. Second, if you have the dirty name – that is, you are in arrears – it is time to go after them. Talk to your creditors, negotiate and clear your name. This is the number one priority when you want to increase the score.
2. Positive Registration
Another tip is to open your positive registration in Loa Vista Consulta. It serves as a financial resume, in which you show the full trajectory of your expenses and earnings. This way, credit information sites will have recorded information that companies consider important, such as your relationship with banks, how many bills you have paid, and more.
Get organized! Make a spreadsheet, get a notebook, download an app. Organizing your budget lets you get a sense of your spending and earnings, and how they directly influence your score. If you plan to apply for a loan soon, this is crucial to staying financially healthy.
4. Payment of bills on time
This one seems obvious, but not everyone can. Pay your bills on time and avoid making debts! Paying bills on time shows that you are a committed and organized person, which financial institutions welcome. Being in debt is not very cool anymore, so how about paying more attention to your money? Besides giving a headache, it directly influences your score.
Sometimes we forget to pay the bills, and it’s normal. If you don’t remember to look at the calendar, now is the time to put them in direct debit. It’s easy, fast and speeds up the payment. But remember to always have money in your account – getting overdraft is a bad idea!
Result: Increased Credit Score Score!
Little by little, you will be able to structure yourself financially and increase that score. Let’s put the goal of increasing some points in this Credit Score? You just have to win. Good luck!