| Not that long ago even people who earned an income | | | | recognized as responsible credit management, if your |
| barely above the poverty level were courted by lavish | | | | credit limit is $10,000. It will only be seen as a consumer |
| offers by the credit card companies. But in today's | | | | who needs use a large percentage of their limit - not a |
| credit market, even the smallest blemish on your credit | | | | good sign. |
| report may result in a bold 'not approved' stamp | | | | Apply for New Credit Too Often |
| planted in the middle of your loan or credit application. | | | | Adding new credit accounts will lower the average |
| Destroying your ability to get credit is about as easy | | | | age of your credit history; and as stated above, a |
| as blowing out a birthday cake full of candles. Here's a | | | | lengthy credit history is a positive attribute of a healthy |
| few ways you can negatively impact your credit | | | | credit score. Every time you apply for a credit card, a |
| score. | | | | hard inquiry is posted on your credit report as opposed |
| Closing Unused Credit Accounts | | | | to a soft inquiry which is posted when you request a |
| A sure way to see your credit score drop is by | | | | copy of your report. Hard inquiries in themselves are |
| closing your available credit accounts. You may think | | | | not the problem; it's multiple inquiries in a short period of |
| you're cleaning up after accounts that are just wasting | | | | time that is a concern to creditors - giving the |
| away, but, when you close an account, your total | | | | appearance of desperation or other troubles. |
| amount of available credit drops - a bad sign to credit | | | | This is not to say that you should not be a smart |
| reporting agencies that has a negative impact on the | | | | shopper. Responsible consumers will consider several |
| algorithms they use to calculate credit scores. | | | | offers before buying a car or signing for mortgage. |
| Part of your score is calculated by measuring the | | | | Your credit score will not be impacted within a 45-day |
| amount of your debt against your credit limit. If your | | | | window while you have auto lenders and mortgage |
| debt levels remain the same, lowering your available | | | | companies inquire about your credit report. |
| credit by closing active accounts will throw the ratio of | | | | Renege on Debt Responsibilities |
| debt to available credit off kilter. If you have only a | | | | Perhaps the easiest way to destroy your credit is by |
| few, low balance accounts, closing one can lower your | | | | skipping out on debt you owe. Paying late or not at all |
| score considerably. | | | | will ensure that your credit score drops like a rock. |
| The only time it is advisable to close an account is | | | | How recently the late payment was made, how late |
| when an annual fee applies on an account that you no | | | | and the frequency of late payments effect how much |
| longer use. And only recently opened accounts should | | | | damage will be incurred. Ignoring an overdue book fine |
| be considered for closing because the length of credit | | | | at the library may hurt more than losing your |
| history is an important component of your score. | | | | book-borrowing privileges. It actually can negatively |
| Experts suggest that the ideal credit customer has 20 | | | | impact your credit score, as can other seemingly |
| years or more of credit experience. | | | | meaningless hassles, such as parking tickets. Many of |
| Credit Cards Left to Collect Dust | | | | your daily transactions are not reported to the credit |
| Even if you don't personally close any credit accounts, | | | | reporting agencies, but these same businesses may |
| your credit card company may close them for you. | | | | send your past due account to collections, resulting in |
| Accounts that are inactive or kept on the back burner | | | | negative reports. |
| for emergencies may be seen as a potential risk | | | | One example is the commonly held opinion that cell |
| factor and closed by the creditor. Also, if an open | | | | phone accounts don't affect your credit report. But |
| account is unused for a long enough period of time, the | | | | that's just not the case. You may not see a positive |
| company can stop reporting it to the credit bureaus, | | | | report about paying your phone bill on time, but default |
| negating any possible contribution to your credit score. | | | | on paying that bill and it will eventually be sent to a |
| The fact that the creditor took action to close the | | | | collection agency who will report the past due debt. |
| account will be noted on your credit report and seen in | | | | Ignore Credit Report Mistakes |
| a negative light. Your credit score will benefit by using | | | | Mistakes on your credit report need to be addressed |
| every active account periodically. | | | | as soon as they are noticed. Many errors are easily |
| Carrying High Ongoing Balances | | | | remedied and are simple errors of misreporting. Credit |
| Even more negative attention is drawn when you use | | | | reporting bureaus are required to take action on any |
| too much credit. Excellent credit scores are a result of | | | | requests made that question an entry. |
| an ample to credit limit with not too much or too little | | | | Building and maintaining an excellent credit score is |
| used and with low balances on several cards rather | | | | particularly important in a struggling economy. When |
| than one large balance. For example, charging $6,000 | | | | lenders are lowering their approval numbers, a great |
| one month and paying it off followed by a charge of | | | | credit score will improve your chances to get the |
| $10,000 the next and paying it off, will not be | | | | credit you need. |