2017…It’s finally here. New YEAR, New YOU.
The time has come to put all that talk you did before Christmas to good use. You’re eating healthily, you’ve even joined the gym. You’ll walk in there all spandex and headband and wake up the next morning looking like Ryan Reynolds and Kate Beckinsale!
Whilst we all like to think this is how it will happen, from experience, I have learnt this is not the case. This is because it all comes down to time. Some things simply don’t happen overnight and you can’t expect them too either.
It’s the same with your financial life too.
Let’s face it, you can’t eat fast food rubbish for ten years and think one day of quinoa salads and a spin class will get your health in tip top shape can you?
Doing some much needed credit repair is a lot like getting fit and healthy.
You put a lot of hard work and effort into it and over time, it will repay you with a better score which ultimately, can get you the things you want and need in life.
Let’s get CREDIT FIT!
So if you do have a poor credit score there are ways to improve it.
If you don’t even know what your score is, then it’s time to find out. It only takes a few minutes to get your score from the 3 main credit reference agencies. Once you have it, you can work with it.
The first things you really need to think about is, how bad is your score and how much do you need to improve it. It’s also an idea to have in mind what you want or need to gain from improving your credit score.
Essentially if you’re credit score is pretty bad and damage control is what’s needed, then improving it will open up a lot of doors for you.
If bankruptcy is your baseline, just keep in mind it can take 5-6 years to get good credit again. Don’t let that put you off though, that’s nothing in relation to a lifetime of bad credit.
You know your score, you know what you want when it’s improved and you know how much of an improvement you need to make.
Now we’re getting somewhere! Have you also checked your credit report? It only costs £2.00 and it is important make sure the information on here is correct and up to date.
You may have been previously financially linked to an ex-partner who may since be a mere speck in your past but they’re score could be bringing yours down.
Maybe you have previously had a CCJ against you that has not been brought up to date, maybe it was registered unfairly or you simply have a different address. So make sure your credit report is fully up to date before you move onwards and upwards.
Whilst you are checking your personal information is spic and span, it’s best to make sure you are up to date on all your direct debits before you start your new financial you plan!
It’s a great idea to blow away those minimum payment cobwebs and start afresh, get up to date on your mortgage payments, your rent and credit card payments, and don’t forget those smaller ones you let slip by each month, the phone contract, vet payments or your monthly car repayments.
Make a list if it helps and tick them off to make you feel you’ve accomplished something.
Not everyone wants to be involved in politics and you might not want to vote in elections but making sure you’re on the electoral roll can show strong stability and lenders like that. Stability shows lenders you are most probably a pretty responsible adult and being responsible means if you borrow money you are more likely to pay it back and without hesitation.
It might seem a little backwards to think that borrowing money will actually help your credit score. But it will. If you want to borrow a large sum of money, say you want a mortgage, or maybe you only need a small amount, lenders will look at your borrowing history to see if they feel it is safe to lend to you. If you are able to borrow smaller amounts of money and pay it back each month, hopefully in full and definitely on time, your credit score will improve and lenders will be lending happy!
Make use of a low interest credit card to keep your borrowing in check. Using just cash or a debit card are really nice ways of making sure you don’t over spend but unfortunately, they don’t count when it comes to your credit score as you aren’t borrowing money. If you’re a little worried about having a credit card because you think you will get a bit shop happy, why not try just using your credit card for one type of payment, for example, when you fill up your car put the fuel on the credit card. At the end of the month pay off what you have used and know that you have only spent it on your fuel. It’s also a nice way of keeping an eye on what you spend on your travel. If you don’t drive you can modify this, maybe for your food shopping instead.
Too much can be overload sometimes though, applying for a credit card to help you get your credit score in tip top condition is great. Applying for a credit card, loan, mortgage and finance on a new car, may not be such a great idea though. Lenders may think you are a little desperate to put it lightly and it won’t put you in a strong position. Try to leave a good break between any applications you might need to make.
And Breathe …
It might seem like a big task to achieve but how many times have you got something great in life without having to work a little for it. If you look at it realistically it’s just about making a few changes and working on a few habits and the rest will do it for itself.
It takes time to get your health and fitness back in order so run your financial workout alongside your New Year regime and you’ll see the improvements in all areas for 2018.
PLEASE NOTE: You in no way need to be attending the gym, eating healthily or getting fit in order to get your financial situation back on track!