The Five Worst Credit Mistakes You Can Make
How to Avoid Them
Your credit score is one of the most important numbers in your life. It can affect your ability to get a loan, a job, or an apartment. That’s why it’s so important to make sure that you don’t make any mistakes with your credit. Scot French will discuss the five biggest credit mistakes that you can make – and how to avoid them!
The first thing you should avoid is maxing out your credit cards. When you max out a credit card, it shows that you’re not very good at managing your money. It also raises your overall debt-to-income ratio, which can hurt your credit score. If you must use your credit cards, try to keep the balances below 30% of the credit limit.
Another big mistake is missing payments. Even if you’re just a few days late on a payment, it can damage your credit score. So set up automatic payments for all of your bills, and make sure that you have enough money in your account to cover them. If you do miss a payment, call the creditor as soon as possible and explain the situation. They may be willing to work with you.
Making small credit mistakes can also have a big impact on your score. For example, opening too many new credit accounts in a short period of time can be a red flag for lenders. So if you’re planning to apply for a loan, don’t open any new lines of credit before doing so.
And finally, one of the worst things you can do is to have an account sent to collections. This will damage your credit score for years to come. If you’re having trouble making ends meet, talk to your creditors about setting up a payment plan. They would rather get paid over time than not at all!
By following these tips, you can avoid making costly mistakes with your credit.