One of the most important numbers in your life is one you may not even know. This number is your credit score, and it changes over time based on several different factors. In Victoria, as well as around the country, a credit score is used for any type of financial transaction, including if you apply for a credit card, a loan, or make a purchase with financing.
The Importance of a Good Credit Score
Your credit score is really a snapshot of your ability to manage debt. It tracks how much debt you have compared to your available credit, your payment history, applications for credit, and your overall management of credit. This includes credit cards, lines of credit, loans, and other types of monthly payments.
Debt consultants provide consumers in Victoria with practical strategies to increase their credit score. This does not happen immediately. However, with the ongoing use of effective credit management strategies, consumers can move from poor credit to good, very good, or even excellent scores.
Reduce Credit Usage
A significant factor in determining a credit score is the amount of credit usage compared to the credit limit. Ideally, consumers should work with debt consultants to create a strategy to reduce current debt levels to 30% or less of total available credit.
Make Payments on Time
Working with debt consultants can help you to find options to make more than the minimum payments when possible and to avoid any late or missing payments. Almost 35% of the credit score is based on your payment history.
Keep in mind, this is not just credit card payments. This is payment on all debts, including payment on mortgages, car loans, student loans, and recurring bills and expenses.