Blog Post

No matter if you want to take out automobile or mortgage loans in York, there is one number that will greatly affect this process: your credit score. This three-digit number is an accumulation of your financial habits. It tells lenders if they can confidently lend you a large sum of money or if they should be wary of this decision.

Your credit score is an accumulation of several factors. A few of these factors include:

• Your payment history
• Your current credit balances
• The length of time you have had certain credit lines opened
• Any new credit lines you have opened
• The types of credit lines you have

Luckily, if you’ve made some poor financial decisions in the past, not all is lost. You can improve your credit score and still apply for mortgages in York.

Here are just a few ways that you can improve your credit score.

Request a Copy of Your Credit Report

This is one of the fastest ways to improve your credit score. You will want to request your FREE credit report from https://www.annualcreditreport.com/index.action and go through it line-by-line. Or, you could schedule a FREE Credit Health Check-Up with one of Member Service Officers and we can walk you through your report. You'll want to look for any errors that could be lowering your score and hurting it. If you come across any errors, you can request to have these removed from your score. If this process is accepted, your credit score can jump up quickly.

If you do find errors in your credit report, be mindful that the process to remove these errors can be long and frustrating. It is not just as simple as hitting “delete.” You will need to work closely with the reporting agency to remove the errors and to fix your score. You may need to provide proof of the errors and other documents before the process can begin.

Pay All of Your Bills On Time

One of the best and easiest ways to improve your credit score is to pay all of your bills on time. For many individuals, this is a challenge and one common reason for a lower credit score. However, paying bills on time is also one of the biggest impacts on your score so it should always be a priority.

If you struggle to pay your bills on time or you tend to forget a bill here or there, options are available to you. For example, many companies will work with you and can adjust due dates for these bills. You may consider scheduling all of your bills so they are due at the same time each month. This will reduce the chance that you miss any.

Another option is to sign up for autopay. This means that the company will automatically deduct the amount of the bill from your bank account each month. You will not have to complete any extra steps to make sure your bill is paid in full each month. However, if choosing this option, you will need to pay close attention to your online banking in York to ensure you always have money available for all of these bills.

Pay Off Debt

Another way you can improve your credit score is to focus on your debt. By paying off debt, particularly your credit card debt, you will increase your line of credit, helping your score. If possible, you should work to remove as much consumer debt as possible. This will not only put you in a strong financial position and you don’t have to pay interest each month, but you will have larger credit lines.

If you cannot pay off your full credit card balance each month, strive to have at least 70% of unused credit each month. This will reduce your risk of having your consumer debt affect your credit score.

Don’t Close Unused Credit

If you have credit cards that you no longer use, don’t close the lines of credit. This will affect your credit score. Rather, you want to keep the accounts open, just do not use them. One major factor in your credit score is the length of time your credit lines are opened. If you do not close the lines, it shows that you have accounts that are opened for long periods of time.

Reduce the Number of Hard Inquiries into Your Score

When lenders look at your credit score, they make an inquiry. If you are seeking financing for a large purchase, the lender will make a hard inquiry into your score. If you have too many of these hard inquiries in a short period of time, it can negatively affect your credit score. Be aware that hard inquiries can remain on your credit report for up to two years. However, as time goes on, these scores lose their impact on your score.

Soft credit checks occur when you check your credit score or a lender or a company checks your credit score because they want to pre-approve you for a special offer. These  situations occur often and luckily, do not affect your credit score.

If you are interested in opening loan accounts in York or are making large financial decisions, you must be aware of your credit score. If your score is low and could use a boost, sit down and create a plan. Determine how you are going to increase your score and the steps you plan to take. Remember that this process can be challenging and will require plenty of time and self-discipline. However, by being consistent, you will reap the rewards and see a boost to your score.