You cannot deny the role of credit scores in justifying your financial well-being. It is a parameter that finance providers refer to ahead of making any decision in favour or against you. Besides, fetching suitable interest rates is not possible if your scores do not reflect a positive image.
Moreover, when these scores are favourable, you are in a position to embrace many opportunities. Having self-doubt when your scores do not seem impressive is natural. You start treating yourself to be in a disadvantageous position. However, it does not mean your credit history will stay like this forever.
For you, it will be astounding to know how a simple step like paying off utility bills is helpful in improving your credit scores. It indicates that the monthly expenses you look forward to covering can take you closer to great credit status. Meanwhile, you can rely on an alternate wayof applying for unsecured loans for bad credit from direct lenders only.
You can fetch financial support despite poor scores to complete payments. On top of this, you do not have to face any demands like collateral. This is only possible if you send a loan request to online providers.
You need to be cautious about the additional payouts like interest rates when you borrow. Upgrading your credit stature is easier than arranging money for loan payments. Accept a few adjustments in your budget and see the transformation.
Take the help of this blog in your endeavour.
The power of disbursing bills on time
You might have a few questions crossing your mind regarding this matter. One of them could be when you are already to make both ends meet, whether the scope for credit improvement in your case is zero.
One thing that you are missing out on in this regard is that credit history is majorly about your past financial transactions. It might happen that your situation has improved and you can now meet bills on time. Besides, you can overlook some payouts to attend to the vital ones.
Look for answers to your questions in this discussion.
1. Will on-time payment of bills reflect on the credit report?
Some of your service providers might add this information showing timely payment from your end in the credit report. However, it will depend on the companies you are dealing with. Do not worry even if does not happen in your case as some factors concerning will get noticed.
Payment record – This is one of the crucial factors in taking your scores to the positive side. Regular payment of bills within time is a good sign in terms of proving financial responsibility. It will contribute to the enhancement of your credit scores.
Credit utilisation ratio – This aspect is applicable to credit card users as they will be provided with a credit utilisation limit by the provider. This ratio draws a comparison between the given limit and the balance on this card. Ideally, it should be less than 30% and you can be on the safer side by showing your responsible credit management side.
Duration of credit history – It shows the duration of time you have been managing various credit accounts. The longer duration always gets the upper hand as it establishes stability and reliability. If you have an older credit card that you do not use any longer, do not close it as you can cash in on it to boost credit scores.
Credit mix – Although it is not a good idea to hold too much credit, it can otherwise prove to be beneficial when you are looking forward to upgrading credit scores. Make sure that you are punctual when it comes to making their payments on time. This way, you can project a positive impression of yourself as a responsible borrower.
Applications for new credit – When you apply for loans with a traditional lender, a hard credit check will follow this step. As a result of it, your credit records will get a negative imprint of it. Now, if you have applied for too many loans within a short span, the impact on your credit history will be huge. Rather you must try to get bad credit loans on guaranteed approval from an online lender.
2. What are the different types of bills you can pay?
Knowing the types of bills, you must attend to first to upgrade your credit scores is critical. It will help you in taking the right step at the right time. Otherwise, it will take time for you to figure out the right direction of approach.
Payment of credit card balance – Check your balance regularly so that you can collect necessary funds within time for payments. This is one of the simplest tricks for you to try out and you can continue using the card without feeling any financial burden.
Repaying loans – If you take out a loan without assessing the repayment term, you can be in great trouble. Maybe, you cannot make it to on-time loan payments which will result in accrued rates of interest and late charges. Pay the loan debts back on time to steer clear of all the roadblocks in upgrading your credit scores.
Mortgage payments – This one is very critical as the amount of loan involved in this case is quite huge. Repaying them on time will demonstrate your financial stability and responsible behaviour at the same time. If you remain committed to paying a loan back on time, there will be no looking back for you.
Utility bills – You must be handling gas, electricity, water etc. bills regularly. Putting necessary efforts to pay them on time. This will not go unnoticed as some of the providers will keep track of it and send it to the credit bureaus.
Medical bills – These types of bills do not get a place in your credit report. However, not paying them on time can be perilous as it will attract negative scores.
The bottom line
You must be aware of the various pointers that are crucial in proving how paying regular bills on time can be advantageous. If you do not want to borrow, follow these steps to improve your scores.
Emma Anderson is a financial advisor at Quickloanslender who always believes in researching hard to know her clients’ financial problems. She takes the time to understand their financial wants and needs to write the blogs on them as the solutions. In her long 14 years of experience, she has written plenty of blogs on the financial and business sectors of the UK.
Emma Anderson has been recognised for her work in financial planning and her blogs are regularly published in the website of Quickloanslender. As far as her educational qualification is concerned, she has done Masters in Accounting and Finance, and done PG Diploma in Creative Writing.
