Improving A Bad Credit Score–Personal Financial Methods Consumers Use To Build Their Credit History

Improving a bad credit score has been accomplished by many consumers through various personal financial methods that can be used to either establish a positive credit history or reestablish one’s history by implementing practices that add positive credit items and overall will increase a low credit score. Typically, the use of credit cards has been one of the more popular options that consumers have used as a way to buy items on credit and promptly repay them from month to month, which reflects well on one’s credit history, but simple financial practices designed to help consumers pay all of their debts on time are one of the more commonsense approaches to bad credit repair.

Yet, there are reports that state there may be new factors that can be used to improve one’s credit score, in some cases, as an article on Kiplinger.com has stated that, “Experian now is including rental payment histories and its credit reports and scores,” for a set number of renters. Many apartment dwellers have often argued that paying their rent on time should benefit their credit score and work in a manner that allows them to improve a bad credit history as, homeowners who pay mortgage payments can see positive results related to their credit score, but renters have, traditionally, not had any help in the area of credit repair or building a credit history by simply paying their rent. While this move by Experian will not benefit every renter, as they have only recently required a credit bureau that receives the payment histories from a set number of renters, there are more ways to improve one’s bad credit score.

Again, many consumers who are either in a position where their credit score is low or are looking for ways to simply begin establishing a credit history that will lead to a positive credit score early in their life, can use simple repayment options on various forms of debt to bring about more positive items of credit, but again, the use of credit cards can be greatly helpful in this area. Understandably, simply paying bills on time is a no-brainer when it comes to keeping a positive credit history, some consumers have opted to use either credit cards, like an unsecured card or secured credit card, as a way of paying off various bills and then, at the end of the month, pay off their credit card balance entirely.  This has created situations where consumers are seen to be paying off a large amount of debt from month to month, and it can reflect well for lenders who may be reviewing a consumer’s credit history in consideration for various types of loans or other forms of credit.

While credit cards and simple budgeting practices can be helpful for consumers when it comes to erasing bad credit debt and rebuilding a better credit history, consumers must make sure that they are in a stable financial position to use these methods, as charging on a credit card to establish or repair one’s credit can be problematic if these costs get out of control. If a consumer is using a credit card to establish a better credit history, but financial problems arise that prevents them from paying off these charges, this will obviously do more damage to their credit score. However, simply using financially responsible habits when both acquiring debt and repaying these obligations will typically not only establish a positive credit history for those who have none, but it goes a long way in also helping a bad credit borrower to begin reestablishing a more positive credit score and history, both of which will be beneficial in the lives of consumers.