Getting out of debt is the first step to improving your credit score and achieving peace of mind. If you are concerned about your level of debt take a look at the options available to you.
Those in debt often feel like they are stuck. Their credit rating is bad because they have outstanding debts which they possibly miss repayments for, and so any other credit they apply for to help pay off the debts is offered at a very high rate of interest. If they are unable to repay these new debts in full they are likely to accumulate more debt, and so on.
Get out of Debt
If you have debts you are unable to manage, seek advice fast.
There are many options available to you, and the help is out there to guide you to the best solution for your particular predicament.
Whether it is consolidating your debts with a personal loan, applying for a 0 percent balance transfer, seeking an IVA from your creditors, or even applying for bankruptcy, a financial advisor will be able to set you on the right path.
Simple Debt Solutions, a leading debt advice organisation, helped Brian and Irene get back on track after their debts started to take its toll on their health and relationship. They were able to organise an IVA so they could repay their debts back at a rate that they could afford, after releasing some of the equity up in their house.
Know Your Credit Score
If you are able to pay off your debts then your credit score may start to improve. Find out what your current credit rating is, so you are able to improve it before you need to apply for more credit in the future.
Your credit rating will be worked out by a bank when you apply to them for credit, each bank will probably rate you differently as there is not a universal credit score that applies to you. However you can get an idea of where you stand, whether it is good or needs improving.
Improve Your Credit Score
Getting out of debt, and finding a debt solution that works for you is the first step to improving your credit score.
If you can show a bank that you are able to meet your monthly repayments, whether this is paying off a loan or credit card, or even an IVA, then this may improve your credit rating.
Everyoneís financial situation is different and a credit rating is determined on a number of factors. If you have a mortgage, for example, and the number of credit cards and loans you are committed to these all help to determine your score and how risky you are as a customer to loan money to.
It may be beneficial if you get rid of store cards of credit cards you do not use, as these may reduce your credit rating. For any credit cards you use regularly it could also be worth setting up a direct debit if possible to ensure you pay off the monthly bill in full each month.