Do you have a very low credit score? Are you unaware of its cause? Trust me, you are not alone! The country has several million people with poor credit scores. Many of us tend to misuse our freedom. From online banking to virtual transactions, everything lies in out figure tips. Conversely, we tend to overspend. This is regarded as an indirect route towards poor credit ratings.
What Does Low Credit Score Mean?
So, what does low credit rating represent? By definition, bad credits are defined as financial files with bankruptcy, judgments and writs. In the midst of these listings, you will not have the wit to boost your credit score for at least 5 years. Bad credits will have a negative impact on your mortgage applications, vehicle loans and mobile plans.
A simple secret
Recent surveys proved that banks tend to reject applications with very low credit scores. Accounts that have overdue(s) for more than 60 days would be rejected immediately. This is a simple secret that is not known by many borrowers.
Three major principles
As you read this article, you will get a clear insight on how and when auto loans should be repaired. To fix bad credit scores, you must follow three simple strategies. Here is a quick insight into these principles:
- Initially, you must be aware of your credit reports. Research proves that credit reports tend to have errors, glitches and mistakes. Wrong data will have a negative impact on your ultimate credit score. When you fail in this step, you will definitely face adverse consequences. Thus, the process of fixing bad credit will become easy only when you have an accurate credit report.
- Secondly, you must not close accounts that have not been used. This is a tactic followed by busy businessmen, with low credit scores. Credit ratings are based on all your accounts. Hence, if you have a static account, trust me, the account will boost your credit score. When you close these bank accounts, your credit rate will decrease gradually.
- Finally, try to repay your debts as soon as possible. Missed payments will increase the number of debts. As you clear these debts, you will definitely visualize a change in your credit score. This is a statement devoured through several years of experience.
Ultimate bottom line
When you follow these steps properly, you will have the ability to change your credit scores.