How to safeguard your credit score during coronavirus?

Nowadays, everything needs a protection layer against coronavirus. The height of threat is that not only your body but also your credit score needs preventive measures. As many financial lives are at stake due to lost jobs during the corona chaos, credit rating falls drastically.

It is necessary to work on the ways that can keep your credit score and in turn, your personal finances in good condition. Indeed, it is difficult, as the money problems are there but to have a safe future, you need to work hard. 

Add a consumer statement to your credit report

Very few people know about this tactic, but it is instrumental. A consumer statement is a mention by a person on his/her credit report about a situational cause that is affecting finances. You can add a statement to your credit report in which you will mention, ‘I am affected by the coronavirus pandemic and facing financial issues.’

With more or fewer changes in the language, you can mention your situation in the statement. With this statement, you can prevent the fall in credit score. When the financial companies make a credit check in future on your loan or credit card application, they will read it. It improves the approval chances also there is no harm to credit score performance.  

Consider a balance transfer for a lower interest rate

The high-interest debts like a credit card are always challenging to tackle. For a solution, you can transfer your debt to another credit card that has a low-interest rate. As a result, you have to pay less on monthly instalments.

Until the wrong time is not over, at least it is possible to stay away from the threat of missed or delayed payments due to high rates. It is one of the most effective methods to protect your credit score from a destructive fall. If you are looking for a last-minute saviour, it is the one that can change things for good. 

Do not make multiple mortgage applications

This pathetic time has indeed hurt the home buying and property investment plans of many people. They are desperate to get their mortgage approved as soon as possible. The procedures are already quite slow nowadays, and people want to get things done faster. To improve the chances of approval (at least in their eyes), they apply to many lenders at the same time. Are you also doing the same? Don’t do this.

Multiple applications invite multiple search footprints of varied lenders. Such people are considered desperate to borrow money, and that adversely affects the credit score. The best approach is to first checkout minimum credit score for a mortgage in the UK, search the suitable lender and then apply. It is never good to look credit hungry in the eyes of the lenders. They may misinterpret you as a financially weak person. 

Talk to your creditor 

It is not easy to parallel your pace with the monthly instalments of all the debts due to corona crisis. The pandemic mess is dominating the financial affairs horribly. If you feel you may miss or delay some payments, then talk to the finance company in advance and ask for assistance. The creditors can help with a smaller instalment amount until the wrong time is over.

When you inform the creditor honestly about your actual financial situation, there is no confusion. You get a timely solution, and no information of delayed or missed payments is sent to credit reference agency. As a result, there is no drop in credit score.

Conclusion

All the above methods are convenient and can back to you to get through the difficult time. However, the best way is to work on your monthly budget. Try to cut the expenses as much as possible.