If you are planning on a loan to purchase your next vehicle, you may want to improve your credit rating before applying. Creditworthiness is usually an important factor for lenders who assess your application and, if approved, also affects the terms of the loan offered. For example, the amount financed and the APR. With that in mind, careful evaluation can mean the difference between a new axle or no new axle, and can potentially save you thousands of dollars in finance charges.

Here are six ways to get credit and increase your score.

1. Clean overdue amounts

Late payments can have a significant impact on your credit standing, according to FICO, one of the most popular credit rating companies. So it makes sense to catch up as soon as possible.

2. Refuse any errors in your credit reports

Check your credit reports with the major rating agencies for possible errors and inaccuracies. Discussing and correcting discrepancies can increase your score with little effort.

3. Pay your bills on time

Set up payment notifications and automatic payments, and change your due date to a more convenient time to stay up to date. Experian says the timely payment is important for all of your bills, not just credit cards and credit accounts.

4. Pay off your debts and keep credit low

The Office for Financial Consumer Protection recommends that you keep your credit usage, that is, the amount of credit debt you have relative to your total limit, to a maximum of 30%. First, pay cards with a maximum balance and a high balance, says, a debt relief organization.

5. Leave unused credit cards open

Even if you have credit cards that show no action, opening these credit cards can have some benefits. First, they help your use of credit. Second, if you have had the accounts for some time, they will have a positive effect on the age of your credit history.

6. Just ask for the credit you need

The credit request leads to a full request for your credit report, and multiple requests in a short time can reduce your score. Finding loans from multiple sources at the same time can also indicate that you are having financial difficulties. However, if you are looking for a car loan, you can make several requests within a limited time, usually 14 to 45 days. In this situation, the rating companies recognize that you are buying the best offer and your requests are treated as one request.

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