How to Maintain Good Credit
May 13, 2021 (Investorideas.com Newswire) Do you currently have a good credit score? If so, congratulations! While this is an excellent start, this doesn't mean your score can't change. In order for you to maintain a good credit score or better, there are a few things you'll want to be sure you are doing regularly.
Pay on Time
Late payments can play a large part in lowering your credit score. Therefore, paying all of your bills on time is critical. To make paying your bills a bit easier, consider placing your payments on automatic payments. This will allow you to remain worry free regarding if you remembered to pay your electric bill or not.
Credit card balances, student loans, car loans, and more. All debts that you have are factored into your credit score. Keeping these total balances low is important. The larger the amount of debt you have in total can greatly affect your score. Continuing to make payments on these accounts is crucial. However, paying a bit more each month or whenever you can will allow you to pay off these debts sooner, which will in return help your credit score.
Keep Your Old Credit Cards
While it is common to assume closing credit card accounts you aren't using is smart, it actually affects your credit score negatively. Closing old accounts impacts your credit utilization ratio as it causes the total amount of credit you have available to decrease.
Lower Your Credit Card Balance
Keeping your credit card balances low is a great way to maintain a good credit score. If you utilize a large portion of the credit available within your accounts, you can expect your credit score to lower. The average rule of thumb is to use 30 percent of your combined credit limits to maintain a healthy credit score.
Monitor Your Credit Report
Even if you are doing everything right, don't lose sight of your credit score. It's important to monitor your credit report regularly to make sure your score is lining up with your financial habits. While it is rare, it's still possible to see errors on your credit report that can lead to a plummet in your score. Which is one of many reasons to always check your report and correct any mistakes that may occur.
The benefits of having a good credit score are plenty. When it comes to obtaining a mortgage loan, seeking lower interest rates, and more a good credit score is definitely something you want to bring to the table. Following these tips to maintain your score will sure to have you on your way to a good standing. If you are currently in need of a quick source of cash and have a good credit score, you can apply for payday loans in Canada for your financial needs.
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