Is your credit score holding you back from major life moves, like buying a home or a car? Wondering how to improve credit scores fast?
While working towards a better credit score is a game of patience and self-discipline, there are things Canadians can do to improve credit scores quickly and hit goals a lot sooner.
Practice good habits
You cannot improve your credit score unless you change your poor habits. New habits should include consistently checking your balances - both of your credit bills and your bank accounts. Budgeting is a habit you should have already adopted. You need to be aware of your credit score and what’s on your credit report if you want to improve your credit score. You can find more great habits to adopt here.
Pay off as much as you can, on time
Eat instant noodles for a month if you have to, but scrape every red cent you have up and put it all on your debts. Bring them down as quickly as you can, ensuring all your payments are made on time. Don’t ever risk making a late payment as that can bring your score right back down again! Bringing your debts down is the fastest way to improve your credit score because it lowers your credit usage percentage. You only want to be using 30% or less of the total credit you have. If you can pay it all off, even better!
Use a Co-signer
Using a co-signer on a credit product such as a loan, and then making all your payments on time, every time is going to do wonders to improve your credit score. Even better, you can improve your credit score faster by paying more than the minimum payment each month. In fact, paying down your loan as fast as you can (while making all your other payments as well) is a surefire way to a higher score.
Become an authorized user
An authorized user is someone who has another person’s card with their name on it. For instance, if your husband or wife has a credit card in their name, they can add you as an authorized user, and you’ll get your own card with access to the same account. As long as the account you have attached your name to stays in good standing, you’re going to be able to improve your credit score, albeit slightly.
Get a secured card
A secured card is like a regular credit card except you have secured it with some of your own funds. If you can get yourself one of these, and then keep it in great standing, you will almost certainly improve your credit score.
Get a secure line of credit
Sort of the same idea as a secured card, except you access it via your bank account and generally, it comes with a lower interest rate. You can also earn interest on your security funds while they are securing your line of credit. Paying off your line of credit on time every month, more than the minimum payment, it going to seriously improve your credit score, so long as everything else you owe is kept up to date.
Credit building programs to improve your credit score fast
Unlike a secured card or a secured line of credit, a credit building program doesn’t require you to put money up in the beginning to secure the program. Instead, the payout serves as the security funds and are only released to you once you’ve paid your program down. This has a double punch to it when it comes to knocking out poor credit, because not only do your regular, on-time payments to your credit building program get reported to the credit bureau like a regular loan, but you can also use the payout, once you get it, to pay down any other debts you have quickly. You will quickly improve your credit score with a credit building program.
One thing to note when it comes to improving your credit score - it requires self-discipline and sacrifice. Good credit requires these two things, and they are the best way to get a sky-high credit score, with few exceptions. If you are willing to sacrifice and change your habits, you’re going to get there.
<< More Blog Posts
