How To Improve Your Credit Score In The Present Recession Hit Economy

This definitely is a known fact that a person with a good credit score is bound to have a great advantage over his lousy counterpart. However it may be a little time consuming but one can surely improve upon his credit score. In the present economy when the global financial meltdown has struck virtually each and every individual, this may sound a little difficult but is certainly not impossible.

A person with an excellent credit rating could have interest rates chopped off to 5 to 6 percent. On the contrary a person with a poor credit history might have to pay an interest rate as high as 22 per cent. This shows the clear difference between a credit score over 770 and a credit score below 600.

In the present times it is a difficult task to pay off all the debts. This may even sound ridiculous considering the present recession hit scenario. However one needs to be mindful of the fact that every decline in an economy is followed by a boom. When the economy booms, everything is available and getting loans and decent interest rates are a cake walk for those who have a good credit score. So this may be the time when you start working on improving your credit score.

Generally when a credit history is looked up, the credit activities of the last 2 or 3 years is given more importance than those of the longer past. To start paying the bills on time may not sound a bad idea to many. Late payment is one major negative in a credit score.
Missing out on even a single mortgage payment may be disastrous in the future. If you have been missing monthly payments for a few months then there is a chance that your account is turned over to a collection agency. In this case the impact on the credit score, which is obviously negative will stay there for 7 years even if you pay all the debts.

In the present economy another important factor can help someone better his credit score.
To keep old accounts open will be a good idea as it helps give a fresh start to your credit activities. However opening many accounts in a short span of time leads to negativity in your credit scores, but closing old accounts does not affect it at all. So one should keep the number of accounts manageable and keep old accounts open. Keeping these accounts open makes sense, but what is more important is that you keep the balances low. If one keeps his credit card balance low and uses only up to 10 to 30% of the credit available then there is a phenomenal improvement in the credit score.

Buying things is tough in the present scenario but writing to the collection agencies is not strenuous at all. In most of the cases it is found that collection agencies have no proof that the account is yours and you can gladly have them deleted from your credit report.

Similarly you may catch an error or two if you go thoroughly through your credit history and this can get you a higher credit score when the mistakes are pointed out and removed.

There are companies who add seasoned accounts to the credit file. Though the charges are on a higher side, but this is a very effective step one can take.

To consolidate balances into a single card is another step to be avoided. May be the interest rate calculations fit the bill, but it is definitely better if one has his debts distributed over several low interest credit cards.

Today may not be the right economy to pay off all the money you owe people. You might as well not have the money to give away, but to improve your credit score may be perhaps time consuming but still is an easy task in the present times.

Various credit reports can be made but all of them more or less provide the same rating. ReliaCredit.com provides the users with credit reports too. With Identity Guard's 3-in-1 Credit Report you get unlimited online access for 30 days to a consolidated report of your credit histories from Equifax®, Experian®, and TransUnion® with side-by-side comparisons.

Hence if one wants to get his acts together then one can definitely hit this page n check his or her credit history.