Keeping up with your credit score in 2019 is extremely important! Knowing what your score is and knowing what to do to increase it will give you greater bargaining power when it comes time to apply for a loan. Please don’t think that when you apply for a car loan that the credit grantor isn’t taking every opportunity to maximize their returns, potentially saying you have a lower credit score than you do just so they can charge you a higher interest rate. Hopefully they are doing the right thing and giving you the best rate you qualify for based on your credit score, but if you know what your score is beforehand, you can know whether or not they are being honest with you. Here are five things you need to do to keep up with your credit score in 2019:
1. Get your score and credit report!
Knowing your credit score and what credit you have is one of the most important steps to building your credit. If you don’t know what your score is, how could you know what to do to raise it? Exactly! So go over to www.annualcreditreport.com and get your free copy of your full credit report from all three credit bureaus. Now go over to www.creditkarma.com and create a login. This is one of the easiest places to monitor your credit score. Since your score change regularly, Credit Karma can help keep an eye on your score. It is updates whenever there is a major change to your score, or once a week. Since most credit lenders update the credit bureaus once a month, you may not see large movements in your score from week to week.
2. Dispute any wrong information
When you review your credit reports, it is important to ensure the information is accurate. You would be surprised how often wrong information will be reported on the wrong person’s credit report. I once had my brother’s credit card information show up on my report. It is important that only the debts you are responsible for show up on your credit report. If the debt isn’t yours and the rightful owner is late on even just one payment, your credit score will suffer. That could potentially keep you from qualifying for a loan, mortgage, or another credit card in the future. Just get it off of there!
3. Update your address to the most current
Your credit report will also have a collection of previous addresses. While old correct addresses are not necessarily a negative thing, having an old address on your credit report can put you at risk of fraud. After you move, junk mail is sure to be sent to your previous address. A scammer can use a “pre-selected credit card offer”, fill it out with your information and open a credit card. It will then show up on your credit report, and it is guaranteed they will not be paying the bill when it shows up. Get a few copies of mail, a scan of your current ID with your current address, and send it off to the three credit bureaus requesting that they update you address. Be sure to tell them that this is your current and only address that should be on your credit report. It helps to send them the letters certified mail.
4. Ensure you have a good ‘mix’ of credit
A good mix of credit is important to a good credit score. Credit cards, auto loans, and home mortgages are all parts of a good credit score. In my opinion, credit cards in good standing are more important to have on your credit report than an auto loan or home mortgage. Why? Because they are lines of unsecured debt. An auto loan is secured by the vehicle. If you fail to make payments on the loan, your vehicle can be repossessed. Similarly, if you default on a home mortgage, the bank will file foreclosure and you will lose possession of the property. Most credit cards are unsecured, meaning there is nothing for the credit grantor to repossess if you fail to make payments. Instead, it will lower your score and the grantor will cancel your credit card. It will then be sent to collections, extremely hurting your credit score.
5. Keep your bills paid on time
On-time payments are one of the most essential parts of credit. If you make late payments, your score will suffer. It doesn’t just hurt your score for the month it was late. It can show on your credit report for years! While it won’t affect your score as much after a few years, it can still affect whether or not a credit grantor will approve a future credit application. Always make your payments on time!