If you’re planning to buy a new car, or a new for you car, your credit score may be on your mind. Whether it’s a brand-new car, a lease, or a new used vehicle, your credit score will be looked at when you go to buy. This is because potential lenders need to know your credit worthiness before they approve you for a car loan. If you have poor credit, it can help you get approved, and help you get a better interest rate on your loan if you work to repair your credit first.
Here is how to repair credit before getting a new car from Mred.com:
- Check credit card balances. If you are maxed out on your cards, this is affecting your credit score in a big way. You can repair this quickly and easily by paying down your balances so you have more available credit. Try to keep the credit card balance under 30% of the total credit line.
- Avoid adding new bad credit items to your credit score. If you take new hits, it’s only going to bring the score down more and make it more difficult to repair your credit. Be quick to address any new issues on your credit report.
- Look into all credit reports and see if there are inaccuracies. If you find mistakes, take the time to correct them before you go car hunting.
- Know ahead of time what you can afford. There’s no reason to shop for or apply for a car that’s way out of your budget. You will just have more inquiries on your credit report but no loan or new car to show for it.
Now that you have these tips for repairing your credit before getting a new car, you can get started. Remember that it can take time to make big changes, but even small changes can have a big impact on your credit score. It’s never too early, or too late, to get started.