One last thing on credit history--what's good for it and what's bad for it? Let's break it down in the final post on credit history! (Hopefully you aren't bored out of your mind by now--beauty and fashion posts will be up tomorrow!)
What Hurts Your Credit Score
- Late Payments or Not Paying at All: 35% of your credit score is your payment history.
- Having an Account Charged Off: If you don't pay your credit card, they will charge off your account, which means the creditor has declared that the money will never be collected.
- Maxing Out Your Credit Card: 30% of your credit score is your debt to your available credit ratio. Try to keep your card balance as low as possible.
- Eliminating Your Oldest Credit Card: 15% of your credit score is your credit history. However, be cautious on this one--if your oldest card has a high interest rate, an annual fee, or if you just don't think you can handle a credit card--cancel it.
What Improves Your Credit Score
- Paying Your Bills on Time.
- Keeping balances low.
- Don't always closed unused accounts, a zero balance may help your score. (Refer to the acception to this rule on number four above.)
- Get a Goodwill Adjustment. If you've been a good customer, ask your lender to remove that one late payment.