When it comes to getting the best interest rates on consumer loans, having a solid credit score is crucial. The three-digit figure provides a snapshot of how borrowers handle their financial obligations — the higher the score, the more favorable one looks to lenders. If you’re in the market to secure a loan or credit card, here are several ways to help boost your credit score.

How to Improve Your Credit Score

1. Make Payments On Time

Lenders like to see a history of consistent, on-time payments. It shows that applicants are diligent about debt management. Paying the balance each month in full also provides insight about how a borrower will make their payments if they are approved for a future loan.

2. Establish Credit History

For those who have never had credit or are new to borrowing, it may be difficult to get a loan. That’s because lenders don’t have a strong track record to look at when reviewing a loan request. Ideally, the longer a person has established credit, the better the chance of having a higher credit score. This is on the condition that they’ve made financially responsible decisions during the time they’ve had credit.

3. Manage Multiple Accounts

Another credit score booster is a person’s ability to manage multiple accounts. Lenders want to see how well they stay on top of home loan, car loan, and credit card balances. Diligent management of several obligations helps improve a person’s credit score. On the other hand, if a person is overextended on different accounts or has maxed their credit limits, credit score could decrease. 

4. Don’t File for Bankruptcy

Unfortunately, life can throw financial curve balls. Divorce, job loss, or the death of a spouse can affect a person’s income. Some may get so overwhelmed by their debt, they have to file for bankruptcy. Doing so can cause one’s credit score to drop significantly. Although bankruptcies stay on a credit record for seven to 10 years, borrowers can get back on track by making on-time debt payments.

Better interest rates and loan terms are possible with a good credit score. Citizens Bank in Byhalia, MS, understands that no two customers are alike — their team of friendly and professional loan officers takes a look at a person’s circumstances and makes all lending decisions in-house. The locally owned bank has served Marshall County since 1919 and is a current member of the Federal Deposit Insurance Corporation (FDIC). For more information on their complete suite of products and services, call (662) 838-2146 or visit them online today.