Improving Your Credit Score: Why the Decision to Finally Repay That Overdue OKash Loan is About to Prove a Game-Changer

 

For starters, credit score is a number between 300–850 that depicts a consumer's creditworthiness. The higher the score, the better a borrower looks to potential lenders. 

A credit score is based on an individual's credit history that encompasses among other factors, number of open accounts, total levels of debt, and repayment history.

Having said that, what is a good credit score, you wonder? 

Well, although ranges vary depending on the credit scoring model, Consumer Financial Protection Bureau (US govt agency), says that generally credit scores from 580 to 669 are considered fair; 670 to 739 are considered good; 740 to 799 are considered very good; and 800 and up are considered excellent.

There is no doubt that every individual borrower would want to have their credit scores reading at least 'fair' even though that is not always the case especially if a recent report that showed that millions of Kenyans' names have been forwarded to CRB, is anything to go by.

Improving Your Credit Score

So, what do you do to help improve your credit score? Here is the real deal.

While a credit score reflects credit payment patterns over time, the more emphasis is on recent information. Older late payments have less effect than more recent ones. 

However, late or missed payments will continue to appear as negative information on your credit report, but their impact on your credit score declines over time.

That is the simple rule that many formal lenders anywhere including OKash mobile loan lender, will more often than not use while deciding your credit score. Be that the case, and you have a pending OKash loan that is nearing the due date or is past it,  you now know what to do. Ain't you?

Remember, when lenders review your credit report and request a credit score for you, they're very interested in how reliably you pay your bills. That's because past payment performance is usually considered a good predictor of future performance.

You can positively influence this credit scoring factor by paying all your bills on time as agreed every month. Paying late or settling an account for less than what you originally agreed to pay can negatively affect credit scores.