Return to site

What makes my credit score poor? You need to know this

Best Loans Provider in Ireland

· Loans Ireland,bad credit loans,loans for bad credit,best loans

Credit score is your biggest financial asset that is intangible but lets you realise many tangible goals. To buy a car, you need car loan and for that, credit score should be good. To buy a home, you need home loans and for that, ‘good’ in fact ‘excellent’ credit score is necessary. In fact apply for a credit card and the finance company will want you to have a perfect credit score performance.

However, your credit score gets affected through your own payment history. In whichever way you act in your financial life and in paying the debts, it is sure to show in your credit rating. When there is any fault in financial habits, a sharp fall comes in this rating. Then emerges the notorious bad credit situation.

It is necessary to know that what makes your credit score poor. This decreases the possibility of mistakes that you are making in your way to tackle financial matters.

Failed to act according to the credit agreement? BAD

Taking a loan and not paying it on time is the failure of credit agreement. Missed repayments, delayed payments, all affect your financial records adversely. Over time, this can lead the situation to very bad credit rating and that is a pure replica of huge financial chaos.

Normally to revive from this threat people apply for specialised bad credit Loans that are available on customised deals. The applicants borrow money, repay the instalments on time and gradually the improvement comes. This solves two purposes – 1. Funds are available to poor credit scorers 2. credit rating improves.

Paying the minimum every month

You may feel happy about paying minimum amount in your credit card. But this is nothing more than a financial suicide. Whenever you pay the least amount, it is equivalent to the interest rate of the past month and also the fees if applicable. It deducts only a small amount from the principal amount that is due. If you really want to avoid bad credit score situation, pay the full due amount.

Identity theft

Threats like identity theft, financial fraud are the realities of the money world. Even in the safest banking services, you may experience this. This has nothing to do with your financial behaviour, as the stimulator of the situation is someone else. Best prevention to this problem is to regularly monitor your accounts and quickly cancel any unauthorised transaction. Setting up an early text or email alert is the most common way to spot or detect such problems.

Having no payment or credit history

With no past payment history, how can credit reference agencies decide if you will pay a debt on time or not. And, if the credit reference agencies are not sure about this, how can the finance companies can be sure about this. To prove your credit worthiness, it is important to have some sort of credit history and that too should be good.

Unused credit card, store cards etc. are threat for financial health

You have four credit cards but only 2 are in use. Same is with the store cards and even bank accounts act in the same manner. If one of your bank accounts is not maintaining even the minimum balance, this is certainly going to show you irresponsible. The actual solution is to quit from all the unused financial commitments.

Conclusion

From taking loans for bad credit to paying the debts on time, do everything you can do to keep the credit score in good health. Money is a complicated word and you need skills to treat it well.