A credit score is a numerical value of a person’s ability to pay back debts and settle bills. It usually ranges between 300 to 900.
A high credit score will increase your chances of getting access to better credit offers and low-interest rates while a low credit score will cost you the opposite.
The payday loan debt help by The Pope Firm assists with personal and business loans payment to help maintain a good credit score.
10 Ways To Maintain A Healthy Credit Score
After getting a credit offer, loan, or credit card, the most important thing to do is to manage your finances in order not to run into debt and cause huge damage to your credit score. How do you maintain a healthy credit score? Read on to find out.
Understand How Credit Score Is Calculated
Credit scores are calculated using your owed debts, payment history, type of credit used, and the duration of use. Each of these factors contribute a different percentage to the total credit score.
Payments history is considered the most important factor in credit scoring and even a single delayed payment can lead to a great fall in your credit score.
Pay Loans On Time
Timely payment of loans will keep your credit score in check and also improve your chances of getting more loans as you have shown your ability to pay off loans without problems. A history of delayed or missed payment of loans would cause a major reduction in your credit score.
Opt-In For Automatic Payments
Using automatic payments is the easiest way to ensure that you make payments when due. You can set up this option on your bank account and schedule the payment in such a way that you have enough funds on the day you want to make the payment.
Settle Bills On Time
Paying all your bills on time will help maintain a healthy credit score and also improve it. Always make sure that you pay at least the minimum payment of all your bills on time. This means you can also pay higher than the minimum amount or the full amount.
Only Take Loans That You Can Afford
When you borrow too much than you can afford, it can get you in trouble and cause serious damage to your credit score.
Spend Less Than You Earn
Spending less than you earn will make you have enough to settle your monthly bills and pay off your loans, you will also have enough savings to settle bills if you get laid off from work or on days when you do not work. This way, you will be able to maintain your credit score and keep it from falling.
Do Not Close Old Accounts
Keeping old accounts helps you to give a long history of good credit and show that you are capable of maintaining several credit accounts for a long time while using just a little percentage of your credit limit.
Keep A Low Credit Balance
Your credit card balance should be as low as 30% of your combined credit limit to maintain a healthy credit score. The lower it is, the better your chances of maintaining a good credit score.
Do Not Close Old Credit Cards
Your old credit cards have better and longer credit history, closing old credit cards will shorten your average credit age and make your credit score drop.
Monitor Your Credit Report Regularly
Make sure you check your credit reports regularly for any discrepancies and errors. Fraudulent activities on your account can result in incorrect information on your credit history.
If you spot any errors on the credit report, contact your credit provider immediately and ask for corrections.