Wednesday, April 20, 2011
Why Is a Good Credit File Important?
Having a good credit file is the be all and end all in obtaining anything from a credit card to a car loan even a mortgage. This means that getting your finances sorted is critical for anyone looking to borrow money and is essential for any personal and financial plans. Here are 5 ways of ensuring a lender will deem you credit worthy:
1. Make sure that you don’t pay council tax, water, electricity or any other bill no more than 30 days late. Financial institutions will see your credit file as a risky proposition to lend money to.
2. Don’t cancel credit cards. It may sound silly not to cancel credit cards as they will form a basis of your ability to repay any payments back. You can always leave the mastercard in the draw for a rainy day.
3. No credit means bad credit. If you pay with cash all the time, financial institutions won’t have a full understanding of your spending habits and are less likely to lend.
4. Keep the credit card application activity to a minimum. Although it’s great that you have a credit card, it’s not so great if a financial institution notices that your can easily spend your years’ salary too early.
5. Don’t falsify information. Telling lies to a financial institution can be considered fraud, so it’s best to be honest at all times.
In short, as long as you don’t make any massive purchases unless you’re able to pay them within 30 days and are sensible with money, there’s no reason why you shouldn’t be credit worthy.