HomeCredit CardWhen Should You Start Repairing Your Credit Score

When Should You Start Repairing Your Credit Score

A good credit score is vital to ensuring that your finances are optimal. In addition, you should have a good credit score as it can unlock many financial benefits like credit cards and loan advantages.

But is there a right time to start fixing your credit score? 

The answer is yes. There are red flag situations that tell you it’s about time to overhaul your credit score.

Below are the situations that tell you to start repairing your credit score immediately. 

Constantly Get Denied by Credit Card Companies

Credit cards are a huge help during emergencies and when your salary comes in late. They also offer an excellent way to purchase necessary things that you can’t afford to purchase in cash. You can also access quick cash through a credit card advance.

A credit card is a widely accepted means of payment online and offline. Many people are also after the unlimited reward points in a credit card feature. Therefore, having a credit card can provide many benefits, but the problem is that you’ll need to have a good credit score to ensure that you will get approved.

If multiple credit card companies have declined you, your credit score doesn’t reach their minimum requirements. It’d be best that you start fixing your credit score so that you’ll be approved on your next try. 

You Can’t Acquire a Loan With Favorable Terms

The number one requirement of getting a loan is to have a good credit score. Although you can find some low-interest-rate loans for poor credit, you’ll be required to provide collateral or a co-signer. 

However, we don’t always have someone willing to cosign a loan with us, and neither do we always have properties or valuables to offer as collateral. In short, having a good credit score is the best way to ensure that you’ll get the best loan terms available. 

To be considered a good credit borrower, lenders require you to have at least a 620 credit score. And because you are a low-risk loan applicant, you’ll be provided with the best term possible. The higher your credit score, the better the terms offered to you. 

When Do You Plan to Purchase a House?

When you decide to buy a house, your credit score will play an integral part in the success of your housing loan application. Like any other loan type, the standard required credit score for a housing loan is at least 620. 

However, it’d be best if you also remembered that the minimum would vary depending on the house loan type. For example, the conventional loan type will require a FICO Score of 620 and higher. 

On the other hand, an FHA loan that requires a 3.5% down payment will only require you to have at least a 580 credit score. Meanwhile, the FHA loan that requires a 10% down payment will need you to have at least 500. And the VA loan type will also require you to have at least a 620 credit score. 

With that being said, if you plan to purchase a house any time soon, start boosting your credit score immediately. 

You Are Having a Hard Time Finding a Good Employment

Although not all, some employment positions will need a good credit score. For example, suppose the job position you’re applying for requires you to handle cash, have full access to the company’s finances, or manage a corporate credit card. In that case, your employer will consider your credit score when hiring you. 

Potential employers can acquire a customized credit report to provide them partial access to your credit history. When this happens, the employer will see your debt and payment summary. 

Some employers will generally check your credit score if you apply for a specific job to know whether you’re going through financial distress and if you’re a risk to the company. 

If You Want to Change Your Financial Status

Everyone will come to the point where they want to become more responsible with finances, and one way to start this is by reconstructing your credit score. As a responsible adult, you should always look out for your financial status to ensure that you’ll enjoy the perks of having a good credit score. 

Once you successfully improve your credit score, everything will fall into its place. And the only way to fix your credit is by learning how to make reasonable financial decisions

You Feel Anxious Thinking About Your Credit Score

Your credit score can also be a significant trigger for anxiety. You feel anxious thinking about your numbers when you know that your credit score is poor. As a result, you’ll feel unconfident and even afraid of checking your credit score.

This shouldn’t be the case. You shouldn’t be afraid and feel anxious when thinking of your credit score. So, if you’re feeling like this with your credit score, you shouldn’t think twice and start fixing your score. 

Start Fixing Your Credit Score and Unlock a Lot of Benefits

Having a good credit score will provide you with ease in the financial world. So, it’d be best to prioritize repairing your credit score as soon as possible to ensure that you’ll acquire the best financial deals and perks that good credit individuals enjoy.

Ajeet Sharma, the founder of Financegab and a well-known name in the field of financial blogging. Blogging since 2017, he has the expertise and excellent knowledge about personal finance. Financegab is all about personal finance which aims to create awareness among people about personal finance and help them to make smart, well-informed financial decisions.


Most Popular