Are you looking for effective ways to improve your credit score in South Africa, a credit score is more than just a three digit number but it plays a crucial role in your financial life, having stable financial behaviors can help improve your credit score.
A credit score is basically a three digit number used by credit providers to help them know how you handle your debts and this number is between 0 – 999, a credit score that is considered to be good is between 603 and above.
When you have a good credit score you have better chances of getting credit from different banks and financial institutes.
5 Effective Ways to help Improve your Credit Score
Many people are now aware that having a good or excellent credit score can help you accomplish many financial goals and if you are looking for easy ways to increase your credit score the following information can help you.
1. Don’t spend more than your credit limit
Spending about 30% of money from your credit card is important in maintaining a good credit, don’t spend all your credit in one month that can badly affect your credit score, for example if you have credit of R20000 you must not spend more than R6000 in a month.
Increasing your credit limit can help your credit rationing, however the current credit you’re owing should always be the same.
2. Always make your payments on time
It is important to constantly make your payments on time because your credit repayment history plays an important role when your credit score is calculated. A payment error will always be on your credit profile even if you pay off the debt, so delaying payment must be avoided altogether.
If you are finding it hard to pay your monthly credit on time make sure to schedule a precise debit order with your bank and creating a reminder of the repayment date on your devices can help.
3. Close or Resolve accounts that are dormant
Closing accounts that you don’t use can help keep your credit score in good shape. Owning a lot of accounts from different banks and financial institutes can badly affect your credit score.
It is important to resolve your accounts before you consider closing them, so if you wanna close a account you should know how much you owe from that particular credit provider, pay it off then contact the company to close the account, it’s that simple.
4. Pay-off all outstanding debts
Paying off all your outstanding debts can really help in maintaining a good credit and profile, many people may find it difficult but constantly paying your debts monthly will eventually lead to a pay off and your credit score will always be in check.
Making a plan to pay your debts can assist you in managing your credit in real time and help avoid backtracking payments.
5. Limit applying for multiple credit
Always avoid applying for multiple accounts or credit when you want to increase or improve your credit score. Having many debts in your name can badly affect your credit score and when credit providers check your score it will always reflect negatively.
In order to keep your credit score in a good state you should follow these effective ways and you must always do a credit check once in a while to monitor your credit score and know how well you are doing in improving your score.
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