Building Credit History

A good credit score gives you better opportunities to rent credit cards, overdraft limits, loans, and obviously a better credit history.

WAYS TO BUILD CREDIT HISTORY

Here are the ways that can help you have a good credit history:-

BASICS

First, you should have a bank account, rent contract, and the bills, you have to pay for, in your name.

Credit history starts building when you pay for three months directly from a debit card and then you receive a mobile service contract.

INITIAL REQUIREMENTS

1. Make sure to pay all your bills on time and keep a check on all your payments.
2. Voting for the UK elections really helps you build your credit history.

FIRST CREDIT CARD:-

You can also apply for your first credit card after several months but after one year it is recommended and the interest rate is high. It will decline as soon as you start to have a good credit history.

INSTRUCTIONS

1. You should be an authorized user.
2. Avoid changing addresses from time to time. Credit scores take time to build but once it’s done, you realize their importance.
3. You should register to vote in the local council.
4. Your pay needs to come via bank transfer from your account.
5. Try to pay your rent through your bank account instead of cash
6. Don’t apply for too many credit cards at once. Have a short break of 3 to 4 months. 
7. Keep old accounts open and deal with delinquencies.
8. You can go for CREDIT MONITORING SERVICES to track your progress throughout.

WEBSITES

You can register on these websites to check your credit score;  Experian, Equifax, CreditKarma.

CREDIT SCORE DETRACTORS

Late or missed payments, high credit card balances, collections, and judgments are major credit score detractors. 

USE YOUR CREDIT CARD’S HIGH BALANCE ALERT FEATURE SO YOU CAN STOP ADDING NEW CHARGES IF YOUR CREDIT UTILIZATION RATIO IS GETTING TOO HIGH.

DEBT CONSOLIDATION

You can take a debt consolidation loan if you have a number of outstanding debts then you will just have one payment to deal with and if you are able to get a lower interest rate on the loan, you will be in a position to pay down your debt faster which will improve your credit utilization ratio and your credit score.