What is an average credit score? Key tips on improving your credit worthiness
Credit scores are important whenever you are trying to get a loan, rent an apartment, secure insurance, buy a home. Here are some tips to stay on top of things
A good credit score may not be necessary thing for everyday work, but if you are trying to get a loan or buy a house, it may be quite necessary. According to a FICO report, the average credit score in the United States is 717. Credit scores even matter at times for landing jobs in the US.
What is a credit score?
A credit score is a number of three digits that takes into account your timely payments of debt. If you use credit cards or have an existing loan, any default in your payment could impact your credit score. The concept of a credit score is almost similar in every country, be it the United States, or even India for that matter.
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If you have a good credit score, it keeps your opportunities for further borrowing open. Based on your credit history and report, you can even avail loans at better interest rates.
Here are 5 Key Tips to Boost Your Credit Score in the US
Pay bills on time
Late payments hurt scores. Set reminders or autopay to avoid missed deadlines.
Keep credit utilization low
Aim to use less than 30% of your credit limit. Pay down debt or request higher limits.
Avoid closing old accounts
Long credit history helps. Keep unused cards open unless fees outweigh benefits.
Check reports for errors
Dispute inaccuracies via Credit score checking sites. Fixing mistakes can lift scores fast.
Limit hard inquiries
Too many loan/credit applications in a short span dings your score. Space them out.
More Tips to maintain your credit worthiness
Mix your credit types: Diversity helps, but don’t open accounts just for this. That could have a negative impact on your score.
Become an authorized user: Use secured cards if rebuilding credit. They require deposits but report good behavior.
According to Experian, it usually takes around 6 to 12 months build a good credit report. Timely payments and credit discipline are the keys to keep things going.
