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Having
Trouble Getting a Loan? Ten Common Credit Mistakes
If you are having credit troubles, you are not alone. Many
people are denied funding, financing and loans everyday because
their credit is poor, bad or nonexistant! Most of these people
make the same credit mistakes over and over.
These common mistakes and tips can help you improve your credit
score and your chances of getting a loan at better interest
rates.
1. Check your credit report. It is one of the most common
mistakes, but you need to know if what is stated on your credit
report is correct or not. Incorrect entries could negatively
impact your score.
2.
Always pay your bills on time. One of the most obvious credit
mistakes, but many people ignore this adage and build a record
of late payments. Even if your payment arrives only a few
days late each month it still hurts your rating. Also not
paying on time causes unnecessary late fees and charges and
can often lead to increased interest rates.
3. Report address changes to creditors to avoid misplaced
bills and late payments.
4
. If you ignore your credit problems, it will only cause more
negative impact to your rating. Contact and talk to your creditors
before you are late on your next scheduled payment and make
arrangements to make your payments on a slightly altered schedule.
This can help keep negative reports from going to the credit
bureaus.
5
. Avoid when possible from using expensive types of credit.
It costs too much in interest and fees and is negatively scored.
6.
Do not charge more than you can afford. This will only lead
to larger and larger debt and higher interest rates, fees
and penalties. Also it puts you in a position where you may
not easily be able to pay off these accumulated debts for
years, or ever. If you must charge at all, make sure you can
pay off the total amount at the end of each billing cycle.
7.
Avoid exceeding you credit limit. Going over your limits will
cause you to have to pay over-limit fees, which will tend
to lower your credit score with creditors and will cause negative
remarks on credit reports. It is never a good idea to exceed
the boundaries set up in your credit agreement, doing so can
only serve to decrease your ability to borrow money at desired
interest rates.
8.
Avoid accumulating too much credit, ie; too many credit cards.
Doing so can negatively impact your score due to the fact
that lenders may doubt your ability to pay off all of your
debt if you were to actually borrow or charge the full amount
of your credit lines.
9.
Avoid paying only the minimum amounts due on your credit cards
each month. Not only does it keep your account balances high,
causes increased interest charges, and the long payment term
necessary to pay it off; it also negatively impacts your credit
score.
10.
Avoid keeping your credit cards maxed out. This can cause
a negative impact to your credit score and your ability to
borrow additional funds.
While
this is not an exhaustive list of credit mistakes, improve
on some or all of these outlined above and you can improve
your credit report score and your ability to gain the confidence
of additional lenders in the future.
About
the Author:
James Smith publishes information on credit issues at http://www.loans-online-i.com/
. Visit the website for more information and resources.
This
article may be freely reprinted as long as the author's resource
box and url links remain intact.
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