A smartphone displaying a credit score

Rebuilding Your Relationship With Your Credit

Your credit score plays a significant role in shaping your financial future. Whether you’re applying for a mortgage, a car loan, or even a new credit card, lenders look at your credit score to gauge your financial health. A higher credit score can unlock better interest rates and loan terms, saving you money in the long run. At Community Bank of Louisiana, we want to help you build a stronger financial future.

Here are five ways to improve your credit score:

1. Pay Your Bills on Time

Payment history is the most significant factor in determining your credit score. Consistently making payments on time will demonstrate that you’re a responsible borrower. If you’re struggling to keep track of due dates, consider setting up automatic payments or calendar reminders to avoid late payments.

2. Reduce Credit Card Balances

Your credit utilization ratio (the percentage of available credit you’re using) is another crucial factor in your score. If you’re carrying high balances on your credit cards, try to pay them down as much as possible.

3. Keep Old Accounts Open

The length of your credit history is also important. Even if you don’t use certain credit cards frequently, keeping them open can benefit your score. The longer your credit history, the more favorably lenders will view your ability to manage debt over time.

4. Avoid Applying for Too Much New Credit

Each time you apply for a new credit card or loan, the lender will perform a “hard inquiry” on your credit report. While one or two inquiries won’t have a significant impact, multiple inquiries in a short period can negatively affect your score. Be selective about applying for new credit, and only do so when necessary.

5. Check Your Credit Report Regularly

Errors on your credit report can drag down your score without you even realizing it. It’s a good idea to check your credit report at least once a year to ensure there are no mistakes. If you spot any inaccuracies, you can dispute them with the credit bureau to have them corrected.

By following these tips, you can take control of your credit score and pave the way for a more secure financial future. At Community Bank of Louisiana, we’re here to support you every step of the way. Talk to your CBLA banker for more tips and financial guidance!

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