5 credit repair tips to improve your credit score in a few months.
Having bad credit is far more than just inconvenience in adulthood.
It can keep you from buying a new home or getting the best travel credit cards. It can also make your purchases on credit far more expensive.
Good credit can easily get you a 0% APR credit card and earn rewarding miles, points, and cash backs. All while bad credit can cost you 24% or even higher APR with skin thin rewards.
If you are in the middle of big life changes like moving, buying a house or getting a new job, it can affect you even more.
Landlords, lenders, and employers can use it as a way to help them decide whether to approve or pass you up. This means that your bad credit can limit your options and hinder you from getting what you really want in life.
Like it or not, credit score, a three-digit number in the range of 300 to 850 can influence our lives in many ways.
Yet, it’s something we tend to overlook and underestimate its importance.
If you have been rejected by lenders or getting high-interest rates, it may mean you have a low credit score.
Luckily, no matter how low your score is, you can repair your bad credit. And in this post, we’ll show you exactly how.
But before we get to the 5 easy tips to take your credit from bad to good, let’s take a look at credit scores, numerically.
So What’s a Good Credit Score? and What’s a Bad Score?
A credit score is a three-digit number between 300 to 850, with 300 being the poorest and 850 being the highest.
It’s a scoring model first created by Fair Issac Corporation in the 1950s. FICO score, the term almost synonymously used to describe a credit score came from here.
Credit score was built as a way to measure consumers’ creditworthiness. Put simply, it’s a way for lenders to tell how likely you’ll replay your loan should they lend you money.
Higher the score, more likely you’ll pay off the debt – on time without defaulting. Lower the score, riskier they see you.
Besides the FICO score, there are credit scores by VantageScore. They use different but very similar credit scoring models to come up with yours.
Generally speaking, FICO scores range from 300 to 850 and are divided into five ranks. Exceptional, Very Good, Good, Fair, and Poor.
You need 670 to be considered good and 800 to be exceptional.
FICO Score Ranges:
Credit Score Table