09:07 21 January 2014
2013 has come and gone and still you see yourself in a stalemate as far as your financial wellbeing is concerned. For this year, it will be good to move forward and include in your New Year’s resolution the goal to improve your credit score. An acceptable credit score can do wonders for your future endeavours such as buying a car or a home or even landing a respectable job.
You could start by getting a copy of your latest credit report then come up with a plan to improve it using the following guidelines:
1. Sort out accounts that have already been turned over to collection agencies, write-offs or properties that are about to be expropriated
All of the above will definitely ruin your credit score and you will have to deal with them cautiously. Accounts that have been outstanding for more than 24 months have already done damage to your credit score so deal with those accounts that are not in that stage yet and deal with the older accounts as soon as you the financial capability to do so. Despite paying the account, this will not instantly improve your credit score because the last activity in the account will be reflected as the most recent. To address this, request the collecting agency to delete the account from your file as soon as it is cleared. Generally, the collection agency will agree upon settlement of the account in full. They can certify this with a letter that you have been cleared of this debt.
2. Settle past due accounts
A large portion of the credit score (more or less 35%) is based on payment history. Being a prompt payer can earn you a good score on your credit rate.
If there are past due accounts, it will do you good to already pay them. Accounts that are 90 days or more overdue can really give your credit score a bad time. Pay off the accounts that are 30 or 60 days overdue then pay the rest little by little until you are free of debt.
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