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    What’s This Fuss Over My Credit Score Really All About?

    When you’re taking a look at your finances and how to improve them, it will always come up. Your credit is fundamental to some of the biggest financial decisions in life. Yet there are still many who don’t entirely understand how it works. So, we’re going to take an in-depth look at credit. What it affects, who sees it and what you can do about it.

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    Why you need to know

    Your credit is, essentially, a record of how reliable you are when it comes to money. How you deal with loans, debts and regular payments are all recorded. Yet it’s easy to forget past money troubles and dealings. 30% of consumers don’t check their credit, only to find it’s stopping them from certain things in life. You can get a free credit check, so there isn’t really much of an excuse, either.

    What damages it

    The negative impacts of a credit score are a lot more easily felt than the positives it can have. You can be prevented from taking out loans or getting overdrafts. Usually, this is because of outstanding debts or loans that aren’t up to date. Surprisingly, paying a loan off early can damage it too. The credit score isn’t about how financially well you’re doing. It’s about how you honour your agreements.

    What repairs it

    By proving that you are responsible, you can repair your credit score. Even checking it can be helpful. A lot of reports suffer from erroneous accounts that decrease your credit score. Checking up on them and disputing them can be enough to immediately repair it. Otherwise, it’s about using your lines of credit responsibly. Pay them back, catch up with all your loans and eliminate your debts.

    Who can see it?

    The positive effects of good credit are invisible compared to the negatives. This is because you don’t always know who is able to see your history. Banks and creditors will obviously check it. But so can landlords who want to see if you’re a reliable prospective tenant. Potential employers aren’t able to see your score, but they can get a look at your report with your permission. A good credit history can be a very convincing factor in these kinds of situations.

    Getting responsible

    To maintain a good credit rating, you should develop a plan for responsible credit usage. For instance, if you have a credit card, it’s not a good idea to max them out. Instead, it’s a good idea to use it from time to time. Then when you do use it, pay more than the minimum to get the balance back up to zero. If you have loans and debts, set the payments to automatic so you’re ensured that they’re being taken care of.

    Maintaining a top credit rating is going to open the doors to a lot more financial development in future for you. It’s also going to help you avoid a lot of potentially tricky situations. Look after it, and the better rates on loans are only the beginning of the benefits.