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Bad Credit Tips

While we are here to help you find the most affordable bad credit loans out there, we do recommend you take time to repair your credit. These are our top tips to get your credit back into shape.

Pay your bills on time

Probably the “golden rule” for having good credit, paying your dues on time can have the most significant impact on your credit rating. It takes up the largest portion of what constitutes your credit score, so starting to pay on time can definitely give you a credit rating boost. To make sure you’re always paying on time, set up your accounts to take payments automatically each month.

Do not use up all available credit

The ratio of your balances to your available credit limit, also known as your credit utilization, makes up another significant portion of your credit score. If possible, apply for higher limits on your revolving credits, and keep balances below 30% of your available credit.

Have a healthy mix of credit

Your credit score also depends highly on the types of credit you have on your account. Lenders love to see that you have experience in handling several types of credit. Be sure to keep a few credit cards or other types of revolving credit active, and include a couple of instalment loans in the mix.

Keep accounts active

It is a common misconception that closing your accounts can help repair bad credit, but in truth, it can damage your score even further, especially if you closed old accounts or those which still have outstanding balances. If you really have to close some of your accounts, make sure to keep old ones open. A lengthy credit history can help boost your credit, and you’ll have an easier time qualifying for a loan if lenders could see that you’ve been using credit for a long time.

Avoid carrying balances

When you carry large balances, loan and credit companies may view that you are struggling with your finances and thus will be reluctant to grant you a loan. If possible, pay off your balances in full every month. Not only will it help your credit, but you can save money from finance charges.

Even if you can apply for bad credit loans in your current situation, we advise you to fix your credit in order to be eligible for more competitive loan deals. For the meantime though, be sure to pay your bad credit loan repayments on time to help improve your credit rating.