5 Ways to Build Your Credit Score while Unemployed

Nov 07, 2022

Financial Advice

Blog Title

Most people took some financial accounts during the pandemic and are still feeling the after-effects. Losing a job has become more typical. The number of unemployed Americans who are actively looking for work in September 2022 is estimated to be around 6 million.

With inflation soaring above 8% in September 2022, being unemployed can make it challenging to make ends meet, and many people look for loans in such situations. However, credit score affects your ability to get emergency loans for unemployed

Here are some different ways to help you build your credit score even if unemployed.

5 Ways to Build Your Credit Score While Unemployed

These seven tried-and-true practical tips can help you improve your credit score while out of work.

1. Update Your Budget or create one NOW!

It is crucial to update your budget, or create one immediately, so you know what income sources you have as well as all expenses. Calculate how much money you can set away to pay off debts and pending payments.

2. Limit or Stop Use of Credit Cards

To avoid adding to your debt, be sure to use your credit card only for emergencies.  Although it can be challenging to quit using your credit card, to make things easier, you may opt to delete your card from websites have one-click purchases to prevent impulse buying. To keep your credit score high, consider using only 20% of your credit limit while making on-time bill payments. If you can get under 10% it is much better.

3. Pay Your Bills on time

Your payment history has a significant impact on your credit score. As a result, making your payments on time is crucial. It's important to keep in mind that when past due debt exceeds 90 days, it can remain on your credit report for up to 7 years. The best strategy to raise your credit score is to pay off your debts on time.

4. Keep Your Old Paid-Off Accounts Open

When you apply for a loan, lenders are more likely to consider your application if you have some open accounts that you have already paid off. Although your accounts might still show up on your credit report even if you close them, it is advisable to leave your paid-off accounts active. While your overdue accounts will lower your credit score, keeping your previous paid-off accounts open can help keep your credit score higher.

5. Check Your Credit Report & do not make New Credit Requests

You should review your credit report to find any mistakes. Aside from the fact that many websites offer free credit reports, be aware of any alerts you get for fraud or account theft so you can report it.

Any new hard inquiries lower your credit scores. So do not apply for new loans, especially if you are not highly likely to be approved. In general, your strategy should be eliminate or reduce all debt and not add any new debt.  If you have credit cards in good standing ask for a credit line increase, higher limits reduce your usage rate and increase your scores. Caution: getting a higher limit should not result in more usage and debt. You want to be less than 10% in your usage rate and 7% is the optimal rate.

Additional Tip:

You should look for balance transfers if you have credit card debt. You should search for a credit card that offers 0% interest on balance transfers giving you more time to pay back that debt without adding interest. Remember, when the offer on your credit card runs out, you will have to pay the whole interest amount that has accumulated over the offer period on your card. So, pay it down or off as soon as possible!

Follow the Tips, Improve Your Credit Score!

Maintaining your credit score while being unemployed may seem impossible, but the key is to keep your eyes tightly on your spending. While most of your financial blunders can be resolved by paying your bills on time and closely monitoring your accounts, following the above tips should help greatly improve your credit score in no time.

Still Can’t Build a Good Credit Score? In a cash bind? Contact LoansinaDay Today!

Have poor credit and an urgent need for cash in an emergency? Look no further. Loansinaday shall see to all your financial needs. Simply apply for bad credit payday loans on our website, and you will be connected with your lender immediately to further discuss the terms of your transaction.

Once approved, you will have your money within one or two business days. Our direct lenders do not need a good credit score to assist you in your time of need. We are open 24/7 all year round to help you with your financial difficulties at all times. Get started with an online bad credit payday loan today!

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