Improving Your Payment History

While it may seem clear on how to improve your payment history, here are a few more suggestions than just making monthly payments:

Be timely with your payment – yes, it’s obvious, but what may not be is why you don’t pay your bills timely. A mindful check-in might be necessary. Then, doing a list of your bills and their due date will be helpful. Put as many bills as you can on autopay. If you don’t have a budget, perhaps this is the time to start.

Catch up on missed payments –  if you are struggling with making payments, pay your current bills first as the older debt counts less towards your FICO score. But, do your best to catch up on your payments.

Communication is key – if you can’t make your payments, talk to your lenders. Most are willing to help you. It could still affect your credit score, but it will get you breathing room. You may be able to lower your interest rate, stop interest altogether for a short period, lower your payment, or make a payment arrangement. The most important thing to do is to communicate your circumstances.

Try not to underpay – while it may be the best thing when money is tight, but it can still affect you. Instead communicate with your lenders. Renegotiate the terms of your loan or mortgage for a lower monthly payment. Try to get a low interest loan to consolidate your bills.

Establish a financial routine – this could be setting two days aside out of the month to pay your bills or devoting more time and starting a new routine that will help take control of your finances.

Seek help – if you are struggling with your finances. Get help. Finances have to do with your feelings, triggers, and financial literacy. You may need a little help at the beginning to build a strong foundation.

Mindful Reminder

Addressing the core of why you are missing payments starts with looking deeply into yourself. Is there anxiety around communicating with the lenders? Are you feeling ashamed or angry about your situation?  Reflecting on what’s underneath first will help you address your finances from a clear and serene state of mind. 

References

Akin, J.  (2021). How to improve your payment history. Retrieved from https://www.experian.com/blogs/ask-experian/how-to-improve-payment-history/

MyFICO.  (n.d). Payment history. Retrieved from https://www.myfico.com/credit-education/credit-scores/payment-history 

Treece, K, Tarver, J .  (2022). Focus on payment history-it’s the most important credit factor. Retrieved from https://www.forbes.com/advisor/credit-score/payment-history/