By Eddie King
Bank Windhoek's Executive: Credit
A good credit status can help with more than borrowing; a good credit score impacts everything from renting a flat to getting a mobile phone. Lenders, landlords, and utility providers will review your credit report when deciding whether to grant you credit and what to charge. Sound credit practices are crucial for establishing and enhancing your credit history and credit rating. Credit providers consider an individual's financial behaviour to be critical in determining a credit application's outcome.
Pay your bills on time.
It is essential to make at least the minimum payment on time on all your accounts every month. Pay your bills on time and, whenever possible, pay more than what is due. This will help you pay down debt more quickly, save on interest, and improve your credit rating. Your payment history accounts for a significant part of your credit score, so paying your bills on time is essential to improving your credit score.
Using our digital channels, you can set up automatic payments for your credit card account on or before the due date or pay your bills online. With iBank and our Mobile App, you can easily set up recurring payments.
Contact your bank immediately if you have trouble meeting the minimum required instalment.
Control your credit card spending
Control your credit card transactions and closely monitor your credit account balance. Your credit score could be negatively impacted if you use all the credit made available. Avoid maxing out your credit accounts.
Manage your debt-to-income ratio
Consider your debt-to-income ratio. To calculate your debt-to-income ratio (DTI), divide your monthly debt payments by your monthly income. Lenders use your DTI ratio to evaluate your ability to manage your monthly payments to repay the money you want to borrow. You can obtain additional credit if your obligations are significantly less than your income. Establishing a budget to keep track of and planning your spending is essential.
Contribute to an emergency fund
Setting aside money each month toward an emergency fund is a smart idea in addition to regularly contributing to a savings account. If you find yourself in an unexpected financial situation, you can meet your credit obligations and unforeseen expenses by using money from your emergency fund.
Set up recurring transfers into a savings account to help you save for your emergency fund.
Monitor your credit reports
It is essential to monitor your credit score regularly and to review your credit reports with credit bureau agencies such as TransUnion to ensure that they are accurate. You can spot any errors or fraud and correct them before they negatively impact your credit history or credit score.
Know your credit score
Once you have verified that your credit reports are error-free, you can focus on building your credit scores. A higher credit score can make credit more accessible and affordable.
At Bank Windhoek, we believe in partnering with our customers for a better future by empowering them through financial knowledge to attain financial independence. By maintaining our open-door policy focusing on relationships, we are convinced that together we do better.