Why Should You Check Credit Report And Score Regularly?
Building financial health with a credit card can be a smart move but using carelessly or not keeping a track of it can turn the tables around. With a credit card, you get a credit report monthly that you need to check every once in a while. Checking your Credit report can be advantageous to you. You should also keep a record of your credit score when it is increasing and when it is decreasing in order to determine which transactions can be fruitful to you. We have listed below 6 benefits of checking the credit report and score regularly that can help you in keeping a good standing account. The benefits are as follows:
Know where you stand: Regular checking of your credit report can help you determine where you stand and thereby helping you in making informed decisions related to the financial. Whether you can apply for a loan or not, whether you are in the state of applying for a new credit card or not. A credit report helps you in all these aspects.
Detect fraudulent transactions: You can easily detect any fraudulent activity happening on your account and report them easily so that your credit score does not get affected and also you do not land up in an unwanted situation. The fraudulent activities can lead you to a debt trap so you need to check your credit report regularly to keep such things from not happening.
Make sure your credit information is accurate: The most important thing of keeping an eye on the credit report is that you can know the errors and omissions in it. The chances of clerical errors happening are pretty high and keeping a check on your credit report can help you in keeping your credit card transaction information accurate. This will also help in maintaining a good credit score.
Stay updated on your creditworthiness: By checking your credit report you get an idea about your creditworthiness. If you have always cleared your credit card dues on time and have a good standing account then the lenders and card issuers are likely to approve your application for a loan or a new credit card after reviewing your credit history. They will know that lending you money is safe as you will repay on time.
Keep Credit utilization ratio under control: One of the major factors that affect your credit score is the credit utilization ratio. Having a low credit utilization ratio will improve the credit score. Keeping a check on your credit report and score will help you in gaining the actual image of your credit utilization ratio. This way you can have better control over your credit utilization ratio.
Avoid unnecessary hard inquiries: Thinking of applying for a new credit card or a loan? The first and foremost step is checking your credit report and score so that you can have an idea of whether applying for a new credit card or a loan can generate hard inquiries against you or not. If you do not have a good credit report or score it is better to avoid applying for a new credit card for the time being and you should start improving your credit history so that you can apply for a new credit card or a loan in the future. This way you avoid unnecessary hard inquiries.
With a parting thought, it is a healthy habit of keeping a track of your credit report and score regularly. It helps you in keeping an up to date information on your account regarding errors & omissions or any fraudulent activity. You can maintain a good standing account with this habit and accrue more benefits in the future. The chances of you getting a new credit card or any loan increase if you have maintained a good credit history. The trick with credit cards is you have to keep your credit card dues clear all the time. You can get the auto-debit services activated so that you do not miss any due date. Also, you can set the threshold spending limit in order to maintain a low credit utilization ratio as you will be notified through an SMS on reaching the threshold limit.