Building Credit a Helping Hand.

Your credit score and history are extremely important pieces of information. They are used to figure out how much of a mortgage you can afford, what your payment will be on your vehicle and whether you qualify for credit cards and loans. Many people will need to lean on their credit health to improve their situation at some point in their life. There is however some confusion over how credit can be built or improved given certain scenarios.

Maybe you have experienced bad credit in the past?

Maybe you have no credit as you are just starting out?

You may be seeking options that will improve your credit score?

You may be tired of seeking credit and being denied?

We have a few tips below on how you can build and improve your credit to avoid any problems when seeking credit.

Make the long term commitment to your credit

If your credit needs rebuilding or your credit is young or you are just starting out, you could approach your bank and ask about a small limit credit card say $500. They may want you to secure this card? This means you will have to give $500 as security. The small step approach to building credit will work well for your credit score. As you prove your good repayment history the card should no longer need to be secured. The best use of a credit card is to pay off your balance in full each month. Lenders are keen to see you are capable of paying your bills.

Don’t run into trouble by opening up lots of loans.

You could add a small auto loan or appliance loan over time. Building up to 2-3 manageable accounts that you can afford comfortably shows a lender that you can handle a variety of loans. Just remember to budget when adding loans to ensure they are all affordable for you.
Also remember take care when opening too many new accounts; too many new accounts will lower your average account age, which makes up for a part of your credit score.

 

Make all your payments on time

Ensure your payments are on time, every time, even utility bills. Unpaid bills can be sold to a collections agency, which in turn damages your credit. Securing credit from a lender is difficult when you are in arrears for what you currently owe.

Make a plan before applying for credit if you keep getting denied.

Being rejected by many different finance companies or banks will further damage your credit history. Ask questions about why you are being turned down for credit. This way you will be able to establish a long term plan to build your credit history.  Or it could help with making a short term plan with a lender that can consider your current credit score and situation. Working in smaller steps could be very beneficial to the long term health of your credit.  

Let your accounts age

The longer you’ve had credit, the better it is for your credit score. Leave your oldest accounts open since they help increase your credit age and build good credit. Unless one of your unused cards has an annual fee, you should keep them all open and active. In turn this will lengthen payment history and increase available credit to you.
Remember to avoid opening lots of accounts at once. New accounts will lower your average account age, which makes up part of your credit score.

For more information about obtaining finance for a vehicle, Argo, quad or boat or just coming up with a plan, bad or good credit, call into our dealership and ask for Matt or Mike. They are the finance experts at Queensway Auto World who would be sure to work out a long term plan that suits you.

 

Long Distance Toll Free 1888-564-2850

Local 250-564-2850

 

 www.queenswayautoworld.com