Facing financial difficulties is not uncommon and the good news about credit scores is you can rebuild them. It might feel overwhelming but it can be easily fixed by creating certain habits that will assure you reach your goal.
Check your credit score yearly
You can easily request a free credit report from the credit bureau. Mistakes happen and although you might be organized, a simple mistake from one of the parties involved could cost you your credit score. It is important to keep a reasonable eye on it.
Set up automatic payments
Life is busy and forgetting a payment can most definitely happen. When everything is automated, you know it will be taken care of, Simply set up your pre-authorized payments and voilà.
Try and avoid credit balances on your card
Consistently leaving a balance on your credit card that is over 10-30% of the amount allowed can damage your credit score. Not only the balance but you should also never go above your credit limit as it can damage your credit score.
Try to avoid credit checks as much as possible
If you need a credit check for any reason, you should always look with the lender/creditor to see what the chances are of you being approved. If preliminarily judged by your situation it doesn't look good, you shouldn't go forward as a refusal will impact your credit score.
Use your credit card as much as possible
Lastly, there is a myth that people advise to stay away from credit cards when you have a bad credit score. However, you should contradictory use it as much as possible since it will show the credit bureau you are capable of managing credit. Using a credit, when done right, can help improve your credit score.
Hopefully these tips will help you get started on re-establishing your credit score. If you are in a situation where you can't see the light at the end of the tunnel, never hesitate to get in touch with one of our insolvency trustees and we can discuss options to get you out of that financial stress.