So, you have credit problems. You are not alone in this journey. Millions of people in the US have such issues and this makes recovering financially or asking for new loans seem very improbable. Increasing the score is the aim of any person. Of course, this is not limited to people with bad rating. Even those with good rating will want to have even better scores since it will allow them to make even bigger loans and get other benefits. To get you started, get your score to know your standing. Here are the next few steps that you should take into consideration.
Revolving Loans – Examples of these are your standard credit cards from Visa and MasterCard, as well as American Express and Discover. These are far more important when calculating your credit score.
The easiest way to raise your score is to get a small loan, and pay it off on time. In general, small loans nashville tn carry more credibility than credit cards. In other words, you will improve your credit score faster if you buy goods with an installment loan, rather than getting a credit card.
For example, that loan you took out to get a new washer and dryer? If your payments are $100 per month and your credit report shows the remaining balance as $800, then it’s evident there are less than 10 months remaining on the loan. In this example, that $100 isn’t counted against your ratios, helping you to qualify.
Another way to earn a better credit history is to take $1000 and open a 6-month CD account at a financial institution. Now, get an installment loan for $1000, using that CD as collateral. Now, here’s the trick. Take the $1000 loan, and open another 6-month CD account at another institution. Take another loan for the $1000 at the second institution. Do this one more time.
You can easily apply for installment loans by filling an online application form. Lender will ask you to provide some personal information like name, address, bank account number, current income etc. This information is kept totally secured. So you do not have to worry about it. On submission of application form lender will verify the information and if satisfied, he will approve the loan immediately. The money will be transferred to your bank account on the same day.
Three caveats to this trick. First, this only works if the lender utilizes the 10 payment rule. Second, this only applies for installment loans; that is, loans that have a fixed term and fixed monthly payment (car loans, student loans, and some personal loans). You cannot use this rule against credit cards and other revolving lines of credit. Third, most lenders will not apply this rule to a car lease, so even if you have less than 10 lease payments remaining, it will count against you. The lease payment rule is not industry-wide however, so check with the mortgage company.