I Want to Know How to Improve My Credit - Here are Some Tips to Do Just That

Having no credit can be bad, but having bad credit is worse. Credit affects many aspects of ones life and can impact on the quality of life you live. If you have found yourself saying, "I want to know how to improve my credit" or similar words, this is for you.

The first thing to do is to determine that you will do something to improve your credit situation. Mind set is the basis of everything, without which you will not succeed. Believe that you can do; that you will do it.

Next, take action. Many people visualize themselves doing succeeding in something but do not follow it up with action. If you don't act, nothing will happen.

Now start the pragmatics. The first thing you need to do is to start paying bills on time. Fail here and you might as well forget improving or repairing your credit: it will not be worth it. Do whatever you can to keep those bills paid on time. This will help build up your credit score if you already have some credit going. What if you have zero credit or have been through a bankruptcy?

There is a catch 22 of sorts when it comes to credit. You can't seem to get credit without credit. How do you start building the credit to build credit?

For those who have to start from scratch, secured credit cards or merchandise cards are your best bet. Secured credit cards are given against a deposit or savings account, which is used as collateral. You get (in most cases) a spending limit equal to the "secured" amount.

A merchandise card is offered by a merchant for use in making purchases from that establishment only. Just make sure that the merchant does report to one or more of the three major credit agencies.

Apart from paying bills on time the other aspect that has great impact on your credit score (which determined your credit worthiness) is the debt to credit ratio. You should always aim to keeping your balance at 30 per cent of the limit or less.

Closing credit card accounts if not a good idea unless you'really have an uncontrollable spending problem. Why? Because it negatively impacts on your credit history; which is an important aspect of your Fico score; and also increases your debt to credit ratio.

It is therefore better when attempting to improve credit to stop using your credit cards but leave them open. However, you should use the card(s) once in while as banks have been known to either close credit accounts that are dormant or cut down the limit, none of which is good for your score.