Want to move into that plush house? Want to cop that fly whip? Feeling like hollering at your bank to receive a loan for your new business? Guess what you’ll need for either of those to happen? Good credit.
Keep these points to credit success in mind as you look ahead to your future:
- Educate yourself on the recipe for a good credit score: Similar to a slamming home cooked meal, you have to know which ingredients go into the pot. Elements such as payment history, the amount of debt, the mix of credit you have, along with other factors, should points of self-education in knowing what it takes to maintain quality credit.
- Maintain a low credit card balance: The traditional rule is that your credit card balance should be 30% of your credit limit in order to establish a healthy credit score. That means if you have a $10,000 credit limit, $3,000 should be the maximum that you plan to utilize on that line of credit.
- Make payments on time: Making scheduled payments on time is key to exhibiting the ability to manage debt and pay monies owed. Also, keep in mind that bills should be paid on time. So in addition to making a timely credit card payment, be sure to pay cell phone, electric, and any other bill prior to or by the payment date. You never know when a particular payment history will show up on your credit report.
- Manage debt effectively across the board: Whether it is a loan debt, credit card debt, medical bills, a mortgage, or any other type of debt, it is extremely important to make payments on time. If you are unable to make payments on time, communicate to the creditor that you will be unable to do so.
- Keep credit card applications to a minimum: Little do people realize that attempting to open several lines of credit causes inquiries into your credit, which negatively impacts your credit score. Furthermore, the more credit cards that you may be approved for opens up the door for the difficulty in keeping up with multiple balances and payments.
For more information, visit http://www.myfico.com