Being overwhelmed with debt can be stressful, but it doesn’t mean there’s no hope for financial success. There are multiple things you can do to tackle debt and simultaneously increase your credit score. Because there are many factors at play when you’re trying to build your credit score, utilizing a financial advisor or the best credit restoration services can be a huge help when you are working hard to tackle this debt.
Typically, your financial advisor will come up with a plan on how to manage your future finances. They will work alongside you in figuring out the best way to pay off your debt in the fastest and easiest way possible. Your financial advisor will be there to aid you in building a high credit score, lowering your debt, and achieving overall financial success you can be proud of.
What Is a Credit Score?
Your credit score is a number that predicts your future credit behavior based on your past credit behavior. This score is measured by your total debt (student loans, credit cards, car payments, etc.), your length of credit history (how long you’ve had credit cards, car payments, etc.), your types of loans, and your repayment history (if you’ve made payments on time). The score ranges from 300, being the lowest, to 850, being the highest score.
What Does My Credit Score Have to Do With Debt?
Your credit score is affected by your credit to debt ratio. So, lowering your debt and having more credit available to you will help improve your credit score immensely. It’s important to take a close look at your finances and see how you can reduce your debt. When you reduce your debt, this will also help increase your credit score.
What Is the Best Way to Pay Off Debt?
When you’re paying off debt, try to pay more than the minimum payment required on your account. Not only will this help you pay off your debt faster, but it will also help increase your credit score.
This is why scheduling a meeting with a financial advisor can help set you up for success to be debt-free and increase your credit score. Your financial advisor will go through your finances with you and discuss your credit history and what your long-term financial goals may be.
Why Does a High Credit Score Matter?
Having a high credit score will help you become more eligible for a loan. Say you’re looking to purchase a car–if the dealership runs your credit score and it’s in the higher range, they’ll know you’re likely to pay back the loan on time and will sell you the car on a loan.
What Is a Good Credit Score?
A great credit score, which means you have great credit history, will range between 720 and 850. A good credit score is between 690 and 719, a fair credit score is between 630 and 689, and a bad credit score is typically between 300 and 629.
If you’re looking to raise your credit score and lower your debt, be sure to get in touch with the experts at The Phenix Group. Our talented team can offer you a free consultation, and we’ll work together to help you achieve the financial success you deserve!
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