How to improve your credit score

05/02/2019

How to go from rock bottom to good credit score 

Have you ever applied for credit and been turned down? For many, this often comes as quite a shock. At every turn — buying your first car, getting a cell phone contract, moving to a new apartment— you’ll need a good credit score. Without it, you will end up either having to pay more in interest fees, or be turned down for credit. 

Keeping your credit in good shape and recovering from a bad credit record doesn’t take a lot of effort, but it does require commitment and discipline. Here are the best steps to take you from rock bottom to a good credit score: 

Regularly check your credit report

A credit report is a record of all your credit activity. It records all your credit applications, credit agreements, and payment history. If you default on payments, your credit profile is affected. This could make it much more difficult for you to get credit in the future. You can check your credit profile for free every year through one of several Credit Bureaus such as:

  1. TransUnion - 086 148 2482

  2. Experian - 086 110 5665

  3. Xpert Decision Systems (XDS) - 086 112 7334

  4. Compuscan - 086 151 4131

In your credit report, look for debts or charges you don’t recognize or that show incorrect information. In addition, check your actual credit score. Should you find that you’ve been listed incorrectly, here’s how you can challenge this:

Step 1 – Contact the bureau in question.

Step 2 – If you are not satisfied with the findings, you can call the Credit Ombudsman on 0861 662 837.

Step 3 – If you are still unsatisfied, you can lodge a complaint at the National Credit Regulator (NCR) by calling 0860 627 627.

Avoid late payment of bills

Pay your bills and credit on time, every month. Late payment on debts will account for a big portion of your credit scores. To make sure this doesn’t happen, automate your payments to ensure you never miss any. When you are rebuilding credit, you can’t afford a mistake like missing a payment. And if you have a high balance, paying a set amount that’s higher than your minimum could be a good way to get out of debt and boost your credit score.

Avoid getting more debt

If your credit cards are maxed out and you’re struggling with cash flow, you might be tempted to apply for a new credit card to make up the shortfall. This, however, isn’t a good idea because it could do damage to your credit score. Instead, take a look at the cards you already have and find out how to get the most bang for your buck. Do you have a card that gives you generous rewards for fuel?

It's never too late to begin working towards an improved credit profile. After all, it could be the difference when you are trying to purchase your dream house, finance a vehicle, pay emergency medical expenses or further your studies one day.

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