Let’s Talk Credit – Credit Score
Normally people use some form of credit to purchase big ticket items. Whether it’s the last 1 in stock or free shipping with the purchase of a certain dollar amount, we cannot ignore how easy it is to get into credit card debt. You don’t even have to have the card with you anymore. Swipe, insert or tap. Electronic payments and devices that save your info make spending easy.
When the instant gratification is gone, we have bills to pay. How we manage them is what impacts our credit score. The better the score, the better the terms and vice versa. Poor credit gets you higher interest rates and payments. When you want to obtain more credit, they look at your history to determine what they will charge you in the future.
What can you do to make sure that you obtain the most favorable loan terms?
- Consistency is key. Pay your bills on time, every time. That’s how you establish good credit history.
- Don’t max out your cards. It’s ok to use them but keep the balances under 30% of the credit limit.
- Review your credit report. Sometimes there are things on your report that are inaccurate and need to be removed. You can request a copy of your credit report at annualcreditreport.com for free. Go over it and make sure that all information is correct. If it is not, file a dispute. Negative items will pull down your credit score.
- Be careful with inquiries. Do not allow anyone to pull your credit unless you are serious about the purchase. Even some “soft inquires” can drop your score a few points. Too many inquiries may also prevent you from being approved.
- Always read the fine print. A lot of credit cards have introductory rates. After the time expires, your interest rate will soar as high as 20-30% on the balance.
Always spend responsibly, your credit score will speak for you!
