There’s a relationship between credit score and credit repair. If your credit ranking is 600 or perhaps below, credit repair is needed so you will always be in good standing.
However what is a credit rating? It becomes an indicator that informs creditors if you are credit deserving. A simple way of achieving this is to encode some things about you in the pc and within seconds, they are going to see the results appear on their screen.
Credit rating ranges from Three hundred and fifty to 850 so that as mentioned earlier, the score of Six-hundred or below is bad because if you apply for any loan, you will be paying higher interest rates compared to someone who has a good rating of Seven-hundred or above and this is generally based on 5 factors.
Initial, the number of inquiries you get in the past 2 years. Do you apply for a loan or a credit card? In the event you did and this had been approved, then as long as you pay it on time, you will have a good credit rating.
Second, what types of credit you truly have? If you have cash, then that is good. If you dont, well dont expect to have a high credit rating.
Third, what is the length of your own credit? People who have a line of credit for 5 years or even more have a better credit rating compared to someone who simply graduated from college.
Fourth, how much is the debt? It is fine to have debt occasionally as long as you are able to pay it off. If you dont owe money to anyone, then excellent because this will be shown on your high credit ranking.
Lastly, what is your payment history? This can be somehow connected with your own length of credit because this can have if you have been able to make obligations on time. If you missed a payment that could be bad but if you haven’t, then you should have a great credit rating.
All these five factors are essential. So you can see if you have any problems, get yourself a credit report from one from the three crediting agencies namely Equifax, Experian, and Trans Union.
You can get a copy from each one of these at the same time or do it at different times during the the year. This statement changes so you need to obtain a copy each year.
One thing you might discover looking at the different reports is that they may not constantly reflect the same thing. When this happens, dont be alarmed because each one uses a various set of protocols inside coming up with those figures.
However, should one thing there be obsolete or mistaken, this particular must be corrected. If you have the supporting documents, compose a letter and deliver this to the credit agency.
If what the report says its true and you’re in a lot of trouble, next steps have to be taken up initiate credit repair. You can do this all on your own or with the help of the counselor.
Regardless of who is actually involved, only one point is certain and that paying off whatever outstanding debt you have is the best to improve your report.
Dont expect that your loan program will be approved if you credit rating is not very good. Do something about it because credit repair is the only option.