Your credit history is very important especially if you are considering applying for and taking loans in the future. Loan providers always check credit scores of borrowers before approving loans. Moreover, consumers are entitled to specific loan products based on credit ratings. If your credit score is high, you could enjoy the benefit of choosing any of your desired loan and getting lower or more competitive interest rates. Here are some ways to maintain a healthy credit history.
? Pay your bills on time. This is the best strategy to earn and keep a healthy credit score. As much as possible, avoid making delayed payments. That is because such delinquencies would certainly be recorded and noted by the credit rating agencies. Take note that those agencies would always find out about your past due bills so always be mindful.
? Avoid carrying or leaving a balance on any of your credit cards. If you are currently repaying in installment a huge credit card balance, it would be best to temporarily keep your plastic card aside so you would not be tempted to use it again to make any purchase. You may have to wait until your previous balance is fully cleared before using your card again.
? Avoid credit card purchase transactions as much as possible. There is a reason for this tip. Most consumers end up buying impulsively and excessively using their plastic cards. The usual result: they accumulate huge debt that is greater than how much they could handle.
? Always check your credit report. Credit agencies are also prone to committing mistakes. Yours is the responsibility to constantly monitor your own credit score. You might be a victim of stolen identity. If you are, filing a police report could be an initial effective way to repairing and correcting your bad credit history. Also contest some bad score entries especially if you are sure that you have always been paying all your dues on time.
? Keep your credit cards active. It is not advisable to close all your credit card accounts. Doing so would make you invisible to credit rating agencies, which is worse. Just remember that your payment history would remain within your own credit report for at least seven years. If you have to close credit card accounts, make sure your credit report would note that those were closed upon your personal request and not upon the decision of the credit card firms.
? Strictly stick with your current payment plans on any debt like home loans and auto loans. There is no need to modify your payments. But if you have to do so, be sure to consult your loan provider and ask for ways that would not possibly hurt your credit standing.
? Lastly, be proactive with the way you handle your credit. Do not even run away from your financial obligations. Loans and debts are meant to be repaid. Nobody could run away from them. Loan providers may fail in collecting repayments but credit scores would always take the revenge.
Andrew has been working in the credit industry for several years, helping businesses and consumers with credit card debt consolidation
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Source: http://creditfinancetips.com/how-to-maintain-a-good-credit-history/
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