These tips will help you maintain good credit standing. Do not apply for new credit lines and pay off all collections and charge-offs. Credit cards should be kept open in order to diversify credit. This will keep you from accumulating large amounts of debt and will increase your credit score.
Do not apply for credit extension
Avoiding new credit card applications is the best strategy for credit cards. Because a new credit application will affect your credit score, Also, you should not apply for new lines of credit if you are already in debt. Instead, work on consolidating your debts and saving money for big purchases. A good credit rating will allow you to qualify for the best rates in loans, credit cards and rentals apartments.
Diversify your credit portfolio
Optimally, you should have a mix of both installment and revolving credit. Open a credit line and make your monthly payments. This is the best way to utilize revolving credit. Also, only charge what you can afford each month to prevent interest. You may also consider a personal loan to show that you have the ability to manage both types of credit.
Charge-offs and collection accounts must be paid
Although it's not always easy to remove charge-offs and collections accounts, they are certainly worth your time. Smart planning can speed up the process, even though it will take some time.
Credit cards: Keep your eyes open
It is important to have at least one credit-card account in order to maintain high credit scores. You must use your credit card account regularly. This is not just to keep it open for the privilege of using. Multiple accounts can make it more difficult to track and increase your risk of fraud. Experts recommend keeping all accounts open. But it is best to keep one card.
Do not ask for too many details
Credit scores can be lower if you apply for too many credit cards and loans within a short period. Although one inquiry won't negatively impact your score, it is best not to make multiple inquiries during a year. Hard inquiries are kept on your credit report for one-year and remain there for two years. Keep in mind that not all credit decisions are based on your score; lenders may consider other factors.
Don't close your credit card if you have balances on another card
Maintaining a high credit score means not closing credit card accounts while you still have balances on another credit card. Your credit score will depend on how you report activity. The risk of being "credit invisible" is high if you cancel a card before paying it off. If you pay your annual fees on time, credit card companies may waive or convert fee-cards into no-fee ones.