How to Improve a Damaged Credit Score
March 14, 2023
March 14, 2023
A good credit score makes it more likely that a lender will loan you money at a lower interest rate and at better loan terms. This is a major factor in the overall health of your personal finances. If your current credit score has been damaged or is otherwise low, there are steps you can take to get back on track and improve your credit score.
The good thing about credit scores is that they are not permanent — a rough stretch of financial hardships and damaged credit does not have to follow you forever. Through careful planning and consistent follow-through, you can improve your score and regain control of your finances.
The first step in improving your credit is assessing your situation and identifying areas for improvement. You should check your credit score regularly to maintain a current understanding of your credit and track its changes. It is also important to monitor your credit report for any inaccuracies that may be affecting your score. Once you have a good understanding of where your score is and why, you should Identify a target credit score that fits your overall financial goals.
Review your debts and expenses to determine how much money you need to budget for each month. You should also consider prioritizing your debts, focusing on paying down any high-interest balances as soon as possible. Ultimately, practicing good financial habits is the best way to increase your credit score.
As you begin to put your plan into action, remember that consistency is key to rebuilding credit — don’t be discouraged if your score doesn’t improve overnight. Focus on making sustainable changes that will set you up for success in the long term.
There are many opportunities that you may consider to help you reach your credit score goal:
In addition to taking these steps toward improving your credit, you may benefit from consulting with a professional financial planner or HUD-approved housing counseling agency.
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