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Repairing Your Credit

by Staff Ashley and Brittany 1 year ago

In today’s world having a good credit rating opens so many possibilities for your future. The world seems to revolve around such ratings. The banks want you to have a nearly perfect score to approve you for that loan. Trying to buy that house? Better keep that credit score in check... Looking to buy a new car? That credit rating will define your interest rates. Here at RV Depot, we are the bank. We get to say “YES” when so many others say “NO.”  Get approved for that home on wheels today no matter your credit score. We offer in-house financing along with traditional financing so we can work with you to find the best option for your needs. Do not let that low credit score stop you from your future. We won't!  


If you are trying to improve your credit rating, we do have a few tips to share to help improve your score. You can always start by getting approved for an RV through us. Having a good payment history accounts for 35% of your credit score calculation. Keeping strong, consistent, and on-time payments will start increasing your score. Past due payments will not make or break your score, but multiple missed payments can seriously hurt your rating. Since we say “YES” to all credit types you will not have to worry about trying to get financed somewhere just for them to tell you no. 


Too many inquiries on your credit can have a negative impact on your score, so do not risk it if you do not have to. Soft inquiries will count for 10% of your overall scoring, which means that if you have a lot of soft inquiries on your credit report, it will affect your score. Soft inquiries are account reviews and preapproved offers, while applying for a loan is an example of a hard inquiry. Fortunately, the damage done by soft inquiries are only temporary. They only affect the credit for the first year, though they are not completely removed for two years. 


Buying an RV through us can help you stabilize your credit utilization ratio, which is another 30% of your score calculated by amounts owed. I know this may be a little bit confusing at first, but this is the amount you owe on loans and credit cards compared to either the high credit limit or the original loan balance. You will also hear this called “total amounts owed.” To improve this ratio, pay down your loans and credit card balances while keeping each open and active. Experts suggest that keeping your credit utilization at 30% or less to maintain a good credit score. For example, you owe less than $3,000 on credit and the original balances of $10,000 or more. So, making more than the minimum payment each month and paying down debts quickly can improve your credit score. In other words, buying an RV through us can help you stabilize your credit utilization ratio.  


Everything good does take time. Building credit is no different. The length of your credit history accounts for 15% of your score. So, unless you have a DeLorean to take you through time to open credit accounts sooner, be patient. You can strengthen this by keeping your oldest accounts open and in good standing. An average credit history over five years will fetch you a higher score than less than three years. Our small loan plans are perfect for this. We finance our units from 4-6 years, meaning this is a perfect opportunity to build the duration of your credit history.  


There are two types of credit: new credit and old credit. New credit is a type of credit that has been applied for in the past 24 months, while old credit is anything that was applied for more than 24 months ago. New credit reduces the average age of your accounts, which can have a negative effect on your score. When applying for new credit, you should only do so sparingly to maintain an average account age that is greater than 24 months. They see it as a potential risk; actively seeking several new credit. 

Maximize your credit growth by taking out a mortgage, personal loan and getting approved for that RV. Mixing the types of credit cards you take out will help you to increase your credit score. The more types of loans you have, the higher your credit score will be. This is because lenders will see that you are managing multiple types of loans which will make them more confident that you can handle paying back a large amount of money. 


Each lender is different, so you do have to remember that these are some loose guidelines to help accommodate, some specifics will vary. Paying the difference between a higher interest rate and a lower one will very easily rely on what your credit score is. For some lenders it’s a matter of approval or denial of your application. Luckily, we look past just your credit score. We know people deserve second chances, or accidents happen. We help say “YES” to your future. Get approved for your new pre-owned RV today! It will help you credit score tremendously when you get it paid off in 4-6 years. 😉


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