How To Manage Your Credit

Credit experts estimate the average American's debt at $8,000, and this is a scary figure. If you pay off $8,000 in credit card debt in a year or would like to, say that this is a good trade off for having a high credit score. So when you're juggling a few bills each month and beyond that with monthly student loans, everyone gets noticed.

The number one killer of your credit score are credit checks. Every time you apply for an loan or credit, the lender will make an inquiry to the credit bureaus. If too many of these are hit or matched, it will cause an inquiry and drop your credit score, especially if done from multiple lenders. Part of your credit score depends on how many inquiries are done, so just because you get one does not mean you are safe from getting denied. This is especially common in the mortgage industry so make sure you don't give a reason at the time of the credit check to justify the rejection of your loan, as this may hurt your score as well. Applicants with insufficient credit are normally denied a loan. This includes car loans, mortgages and credit cards. It is suggested you try to have a good standing on your credit before attempting to get a loan. Should you be denied on your application, you can always appeal to the lender. The request has a 45 day deadline. The denial, however, should be finalized within 30 days. It is always advisable to contact the lender for a reason, rather than simply denying you application.

Another way to manage your credit is to establish good credit. The best way to do this is to pay bills regularly and keep your debt to available amount low. It is almost always cheaper to carry a balance rather than paying in full, and this can be done by buying things like the house or a car. The more credit extended to you, the more you can spend. You will most probably only be able to get a loan if your credit rating is good, and this is where the money saving begin.

If you own a home, or if you have a credit card, or if you have a savings account, chances are you are making your payments every week or every month. You should never be late on these. These are essential to your credit. Your credit report will know if you are living within your means and are budgeting your money. If you're living beyond your means, you need to make changes. Cut back any excess budget and free up more money to pay these bills.

In order to keep your scoring good, consider getting a credit card to use wisely. There are some excellent cards that can give you points if used wisely. Pushing these points will help you from getting disqualified due to missed payments. Make sure that you know how to pay this bill before you spend any money. You should buy things that you can afford, and not make purchases just because of the rewards program. You will need to keep your balance low to push the point, and you should make the full payment. If you maintain this over a period of time, you can be on your way for a healthy credit score.

 

Know when your time to use your card is. You should know when you have 30 days to pay off a certain bill. You should also know the due date of your bill and when you need the payment in. If you don't have this information, card companies will hold onto your money.