Your credit score can either make or break your finance.
Let me explain.
You have to work with your credit score and make it a point in developing it as much as you can and retain it in the way that is needed.
But why are we so careful about the credit score?
Well, there are a number of reasons for that.
Your credit score is one of the most important reasons or factors that determine the health of your finance.
In that regard, you have to make yourself aware of the definitions of the credit score and make it more appropriate for your finance.
With that being said, we can now focus our energies a little bit in learning the credit score.
Your credit score is generally a number. In that case, the credit score is a definition of the nature of the transactions made by your credit card. It signifies how well (or how badly) you are maintaining your credit card transactions.
So, what are these credit card transactions?
Your credit card has an Annual Percentage Rate or the APR
- There is a credit card interest rate
- You may have to pay penalties if you are not making the payments in time
- Your money transactions using your credit card must also be made in the right amount. Otherwise, you again need to make penalties and all.
- These things are observed by your credit card organisation and are also monitored by it. So, your credit card score is actually going to characterise the credit card behaviour in that regard.
- Your credit card provider is going to set a credit limit for you. If you somehow exhaust more money than your set credit limit, which is a highly common problem around the world, then you might get some other work and that too in the
Often, for failed transactions; poor maintenance and of course crossing your credit limit, you can have trouble with your credit score
That is to say, the credit score is going to go low as per the norms used in the credit card organisation. This will make you pay more credit card bills.
You can still solve the problem with the help of a business loan or a personal loan with bad credit. We can do something more than that. We can offer you a super-fast guaranteed approval for a business loan for bad credit in the UK online.
Now we are going to discuss some points about the credit score in detail.
Credit Score: Know Something More!!!
Your credit score is a simple number.
This makes it more and more understandable in a way.
The credit score in the UK is followed by three standards. These are standards maintained by the International standards.
And the thing is these standards are not followed together.
You can use only one standard to find your credit score. You can talk to your credit card provider for more details on this.
The standards that the credit score follows are:
The above-mentioned are also called agencies, which are responsible for determining your credit score, based on which you will prepare your next action.
But the thing is generally it is counted in a range from 0 to 999 and we can have a clear idea about the good and the bad credit score with the help of this score.
Remember, the credit score is just a number that tells you about the condition of your credit card. It resembles the health of your credit card transactions.
Now if we are looking at a bad credit score, then we are also looking at a good credit score.
In that regard, you will also have a moderate credit score.
And here they are given below:
- A good credit score is anywhere from 720 to 999
- A moderate credit score is anywhere between 720 to 600
- A credit score goes low or bad (or poor) when it gets to be lower than 599
If the score goes below 400, then you can call it a very bad credit score
Now the question is who gives you these credit scores after calculating them?
Well, the three agencies mentioned above are also known as credit insurance agencies or CRAs. They are going to take care of your credit score calculation and would offer it to your credit card institution, from which you have purchased the credit score.
How Exactly a Credit Score Goes Low?
A credit score goes low for a variety of reasons. That is why people (and there are so many of them) search direct lenders for a bad credit loan with no guarantor online.
Being a direct lenders ourselves, we have understood the values of credit card utilisation and how sensitive it can be provided with the situation therein.
There are many reasons or causes, for which your credit score can go low.
Spending More than the Credit Limit
It has been reported by credit card institutions all over the globe that one of the common and the most reported credit card misinformation has been the credit limit breach. With the purchase of a credit card of almost any type, the credit card holders are given a percentage of the credit card balance as the amount above which they cannot spend anymore. When they do spend some more money from that, the credit score goes low as the holders are not adhering to the rules and regulations as stated by the credit card provider.
Payments Not in Time
Making late payments also lowers your credit card score. But that is not where you get affected the most though. You pay some extra amount too as a charge for the untimely payments.
Payments Not in the Right Amount The same thing happens again if the money is paid insufficiently. When you are failing to make payments in the right amount, your credit card provider will
naturally be making its readings on your credit card and you might suffer a low credit score.
Not Paying the Interest Rates Sufficiently
Although it is clear that most credit card holders maintain a good deal of transparency and timely payment of the Annual Percentage Rate and the Interest rate of the credit card, it is certain that we have met many in our borrowers waiting for our guaranteed approval of direct lender long term loans for bad credit. What we have understood from their accounts is that there are many in the UK, who are still unable to pay the credit card interest rates and the APR at the right time because of rising living costs and financial struggles. However, this is not just a contemporary problem. It has existed since the time credit cards have been made available.
How to Improve Your Credit Score
Improving your credit score isn’t an issue when you know what you might want to do with it.
The main thing with improving credit score is defined with material consciousness.
If you are ready to make a change, then you will make that change happen for good. We can help you with that in a few of our ways.
- Keeping your credit utilization rate low is key to solving this problem. Let’s suppose you have got 4000 pounds as your usual credit balance for a month and that you spent about 2000 pounds on buying something. Now your credit utilization rate is 50%, which is good. But, in most cases, the credit limit remains 30% to ensure good financial behavior. So, if you go for spending 1000 pounds, then your credit utilization rate I going to come at 25%, which is below 30%. So, enjoy all those credit card benefits.
- Now comes the problem of credit card accounts. Businesses and even individuals who have real financial requirements and complex finance management policies can sometimes need more than one credit card. But the issue is that they often keep those accounts open without keeping them active, and that means keeping them running yet making no financial interaction with them, which makes their credit score go low and you ultimately make payments for them as a penalty. A good way to stop this is to stop the accounts immediately because you don’t need them.
- Taking out a bad credit loan from direct lenders is one good way to maintain transparency in your credit situation and to also make sure that you have improved your credit score. You can take out a bad credit loan and make your pending credit card payments, whatever you may have, and then return the money from the bad credit loan. Paying your credit card dues and then making the timely payment to your credit card provider will certainly make it a point for your credit score to go uphill because you have maintained regulations in making multiple payments using the credit card.
We have also worked with people who used this tactic with guaranteed car finance with direct lender facilities.
They purchased their car with the help of this loan we gave them and hen improved their credit score by repaying us the loan following accurate loan terms.
As you have learnt about your credit score and all that is important about it, you can now take a break and think about your personal credit score.
Oh yes, do inform your credit card provider of the updated credit report and credit score.
Don’t just stop there.
Make a thorough check of the credit report and the credit score with the information you have received where you used your credit card for the transaction and cross-check the data.
If you do find errors, you have full right to complain to your credit card provider and to appeal to them to revise your credit card report and credit score.
Well, that was a lot of reading.
Now you can think about your credit card scores and reports. But don’t stress it, okay?