Many people do not know this but one of the factors in determining your credit score is how much credit you are actually using in relation to the amount of revolving credit you have. Your credit rating will be a lot better if the percentage is smaller.
You should try keep your credit to debt ratio at about 30% or lower. Obviously, the lower you can keep this percentage the better your credit rating will be. This information is provided by a credit senior consumer specialist. These specialists know exactly how to calculate the factors that are required for a good credit rating and therefore you should listen to everything that they recommend. Increasing Your Credit Score One of the ways that you can increase your credit score is to keep your balances low and if you have balances that are high, try to pay them down as quickly as possible. It should be noted that people pay their full balance every month will still maintain a higher utilization ratio. The reason for this is because there are certain credit companies that send the balance that is on your statement as your credit report to the credit bureau. One of the best ways to improve your credit score is to completely remove any nuisance balances. A nuisance balance is a small balance that you would have on a number of credit cards. For example, you may have a small balance on your various gas credit cards, furniture store credit cards, major credit cards, or any other number of credit cards. Outstanding Balances Credit card companies receiving a new application, look at how many of your cards have a balance outstanding. Therefore, you should utilize only one major credit card instead of a variety of smaller ones. Simply gather up all of the credit cards that you have small balances and pay them off. Then use one or two of your major credit cards to purchase everything else that you buy. There is a misconception out there that an older debt on your credit rating is a bad thing. The simply is not true. Therefore, when you finish paying off a particular loan do not try to remove the information from your credit history report. This old debt will show the credit bureau that you are responsible when paying off your debts. For some of the other misconceptions regarding personal credit scores, please take a moment to visit this recent Huffington Post article - http://www.huffingtonpost.com/2014/12/14/credit-score-myths-_n_6296012.html Managing Your Debts Sensibly It should also be noted that even though a negative report is bad for your credit score it will be removed after seven years. Leave those older good debts that you have managed well on your credit report as long as you can because it is better for your overall credit score. Also, simply try to avoid any negative reports on your credit rating. For additional hints and tips relating to avoiding negative reports on your credit rating, please check out 2 of my other sites by clicking on the links below:
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