Improving Your Credit Score

For most people considering a logbook loan, you most likely are dealing with a bad credit score. Since your bad credit score is keeping you from going to a bank, you are looking for another loan alternative, and you have settled on a logbook loan. While a logbook loan is great in the meantime, it would be best if you also worked on your credit score so that in a couple of months, if you need another loan, you can go to a bank. Improving your credit score can take some time, but with just a few simple practices, it doesn't have to be difficult.

The first step that you want to take is learn as much as you can about your credit score. To do this, you are not only going to need to know what your score is, but why it is what it is. There are many sites online that can give you a full copy of your cred it file, including Experian and Equifax. Once you have the copy in your hands, you can comb through it an d see what factors are contributing to your low score. It may not be one single thing that is bringing your score down, but a combination of a few smaller ones. Once you know why your score is low, keep it in mind when you are working on the following things.

One of the biggest contributors to a low credit score is mismanaging your credit cards. When you use a credit card you are essentially taking out a s mall loan, and each time you do it factors into your credit rating. Credit reporting agencies want to se e that you can borrow responsibly, but not borrowing too much at a time, and always making your payment s on time. The measure they use to judge this is called your credit utilization. This is the percentage of your total spent against all of your credit limits combined. Ideally you want to keep your credit utilization between 30 and 70 percent in any given billing period. If you can do this, it will help yo u to improve your score.

Another common factor in low credit scores is overal l debt. Besides any money you owe on your credit cards, if you have any other loans out, it wi ll impact your credit rating. The best way to improve your credit score in this scenario would be to simpl y work on paying down your debts. If you can make even slightly larger payments each month it w ill help. Or look into transferring your debt to another loan with a lower interest rate in order to s ave yourself some money and make paying it back faster and easier.

Lastly, credit scores are largely impacted by time. If you have just opened up credit accounts, your score will remain low until you have demonstrated t hat you are trustworthy. Similarly if have just started making changes to your habits, it will take time for them to have an impact. Credit reporting agencies want to see that you can be trustworthy over tim e, so work on keeping up good habits for as long as you can. Also be sure that you are making all of your payments on time, as a single missed payment can lower your score for a long time. If you ha ve missed payments in the past, just keep making on time payments for as long as you can to make up fo r it.

Hopefully these few suggestions will help you to improve y our credit score. Remember that this isn't going to happen over night, and that you will need to kee p up with good habits for a while. If you can do this however, then before long you should start to see a rise in your credit score, and then after that you can get the loan that you've been after. Good luck!

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