Financial Advice For Those With Bad Credit

Do you have a low credit rating?

17:14 03 September 2020

This can be incredibly frustrating in today’s day and age where credit can play an enormous part in modern life. People often need to be able to use credit, whether this is to buy a home, buy a car, or take out a loan, but this can be difficult if you do not have a great score. This then becomes a dangerous spiral because it can interfere with your life and create financial hardship. Fortunately, there are plenty of tips that will help anyone with a low credit rating and could make a big difference to your entire life.

 

Check Your Report Regularly

 

First, it is a smart idea to check your credit report from time to time (at least once a year). This is so that you can report any inaccuracies and spot fraudulent behaviour which could be negatively impacting your score. Equifax, Experian, and TransUnion are the three main credit scoring agencies in the UK, and you can check your report through their partner websites.

 

Improve Your Credit Rating

 

Obviously, taking action to improve your credit rating is an important tip, but keep in mind that it can take some time to improve your score, so the earlier that you start, the better. There are many different steps that you can take. The main ways to improve your credit rating include:

 

• Register on the electoral roll
  
  
• Pay your bills in full and on time
  
  
• Close financial ties to anyone with a low credit rating
  
  
• Avoid County Court Judgements (CCJs) - find debt advice online if you need it
  
  
• Clear existing debt where possible
  
  
• Keep credit utilisation at 25% or lower but use often
  
  

Use Bad Credit Leasing Companies

 

One of the biggest challenges that people with a low credit score face is getting approved for a car lease. They either will not get approved or only for a rate which can make it difficult to afford, but there is a good solution with car lease with bad credit specialists. These businesses do not look at your credit rating and instead only your bank statements to see that you can afford it; plus, the contracts are usually flexible with easy to manage fixed monthly payments. Not only this, but leasing can be a good way to build up your score.

 

Educate Yourself On Credit & Personal Finance

 

One of the main reasons that people end up with a low credit rating is that they have little to no education on credit and personal finance, as it is not something that is taught in schools. Therefore, to learn how to avoid a low score in the future, how you can use credit intelligently, and how to improve your overall financial situation, it is worth learning about personal finance, and there are many good ways to do this:

• Courses
  
  
• Blogs
  
  
• Podcasts
  
  
• Newsletters
  
  
• Following experts on social media
  
  

Life can be difficult with a low credit rating, and it can feel suffocating, but there are ways to manage and improve your score over time, which can give you a fresh start and more options.