High credit scores are not necessarily bad. A credit card application can be rejected if you have made mistakes in the past. Diane Elizabeth, a woman of excellent credit, was turned down for a credit card because she made two late payments over five years on one of her credit accounts. After contacting the bank and reapplying, she was successful.
Low credit utilization
High credit utilization can lead to negative credit scores. There are many ways to reduce your credit utilization ratio. First, make sure you are not maxing out your credit cards. It is best to not exceed your credit limit. This will lead you to high credit utilization.
Having one type of credit
Credit mix or the combination between different types of credit can have an impact on your credit score. This account for 10% of your overall credit score. You will have a lower score if you only have one type credit. There are many ways to improve your score. You can use different types of credit, or reduce your utilization.
Late payments
Your credit score could be affected if you make late payments on a regular base. There are ways to make your credit score better and avoid making late payments. Pay your past due debts promptly and catch up on them if possible. This won't reverse any past late payments but it will make your payment history more detailed.
Having multiple credit cards
While having several credit cards can help you raise your credit score significantly, it is important to be aware of the potential risks. Multiple credit cards can make your credit history look bad and could lead to increased debt and credit checks. Not only will this affect your credit rating, but it could also lead to a lower credit limit. It is better to limit your credit card balances to one or two. So you only have to use them when you need them.
Credit history that is long
Credit score will be affected by the length and quality of your credit record. Because your credit score will rise the more you have credit history. The number of accounts you have is another factor. A longer history means that you are less likely not to miss payments. Closing old accounts can decrease the length of your credit history, but it will also lower your average age. The age of your last account will also affect your credit score.
Good payment history
Your payment history plays a major role in determining your credit score. You'll see a rise in your credit score if you make your payments on time. Your score can be hurt if you make late payments. Remember that late payments on older accounts may affect your score more than the ones that are current.
Tracking your debt
Credit repair is only possible if you keep track of your debt. A third of your FICO score is based on your debt, so you must carefully monitor your credit usage. You may need to reduce your borrowing to improve your score if your debt is too high.