Times are tough right now, and many people are facing up to the real possibilities that they will be in financial difficulties if the current restrictions on businesses and work continue. It’s hard to fathom a world where, despite your best intentions, you’re not allowed to work and earn money, but this is the reality that some people are currently facing.
If you’ve managed to keep your head above water, financially speaking, over the last few months, then you’re doing well. The worst thing you can do now is let that go to waste by making bad financial decisions. That being said, if you haven’t been able to keep your head above water, you may have damaged your credit score just trying to stay afloat, but there are ways you can rebuild this and make it work for you. Here are four tips for rebuilding your credit score and getting you back on dry land when your finances have settled down.
Consolidate Your Debts
Everyone has debts in one way or another, it’s very rare for anyone to live fully debt-free, but that doesn’t mean you should let your debts overwhelm you. If you’re finding it hard to pay off all of your debts, it might be an idea to look into loans for bad credit. A debt consolidation loan is a great way to pay off all of your debts to different places and end up with lower monthly payments.
Don’t Miss Payments
Missing payments is possibly one of the worst things you can do for your credit score. It shows lenders that you are unreliable, and it will stay on your credit score for a long time, even if you only miss it once. If you know there is a bill coming out that you’re unable to pay right now, it might be worth getting a quick loan that will cover it, which you can pay back as soon as you get paid. This will allow you to stay out of the bad credit zone by meeting the payment.
Don’t Use Your Whole Credit Limit
If you have a credit card, try to keep at least 30% of the credit limit free. This is known as a credit utilization rate and helps people understand the buffer zone for credit cards. Not only will this mean that you always have 30% of your credit limit for emergencies, but it will help to build a better credit score by showing that you don’t need that extra buffer zone even in your financial circumstances. See Credit Sesame Review.
Get Help From Family or Friends
Becoming an authorized user on a friend or family member’s credit card and/or account shows that you are responsible for money and that you are trusted with money. If you’ve got a bad credit score, this will help to boost it up so that new lenders will be more likely to lend to you. Forbes has a great article explaining why authorized user status is good for rebuilding your credit score, so check that out for more information.
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