How to Maintain Your Credit Rating
by Dean Shainin
It used to be your credit score just determined what kind of car or house you could buy. Today, even employment decisions are increasingly based upon your credit, with a poor score suggesting a lack of judgement.
Steps to Maintain Your Credit Rating
Pay your bills as soon as possible.
Waiting until they are past due or nearly past due will shave points off your FICO score.
Don't carry a balance on your credit card.
If you get stuck with an especially large balance (these things happen), you might need to put that card in a drawer for a month or two until you can pay it down.
Carry as few credit cards as you can.
This means turning down department store and other specialty cards. Too many will mean a large available credit pool, which means you're in danger of over-extending yourself.
Check your credit report on a regular basis.
If you see anything that isn't supposed to be there, or if you suspect your identity has been stolen, act immediately! You can start by filing a police report with LOCAL law enforcement. This police report is the first step in credit repair.
The longer you have an account, the more credible you seem. Jumping from card to card (tempting with low-interest transfer balances and other scams) will harm your credit.
Stick to your payment plan on long-term debt like auto loans and mortgages. Change your payments only when absolutely necessary and only after consulting with your lender.
Above all, stay proactive with your credit! Running away from your obligations or putting things off is an excellent way to ruin your credit and your future.
Tips to Maintain Your Credit Rating Tips
Most lenders use the FICO Score(R), a mathematical formula based upon your payment history, to make credit decisions. Your score can range anywhere between 300 to 850, with a higher score indicating better credit. Most people have scores in the 600s and 700s.
You can get one free credit report per year from each of the credit bureaus. This does not include your FICO Score(R).
Copyright 2006 Dean Shainin
Dean Shainin offers online bankruptcy and debt advice. For more information, articles, news, tools and valuable resources on bankruptcy and debt solutions, visit this site: http://bankruptcy.deans-knowledgebase.com
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