Not only is credit a key factor in securing loans, potential employers may review an applicant’s credit and it’s also used to determine auto and homeowners insurance rates you pay.
Don’t close old accounts: While this may seem counterintuitive, closing a card may negatively impact your credit. It reduces your credit-to-debt ratio and credit history which lower scores.
Ask for an increase on your credit line: If you have a $5,000 credit limit and you are using $2,500 on average, that’s a 50% ratio. If you get an increase to $10,000 credit limit now you are using only 25% of what’s available which will improve your scores.
Limit the total amount of cards you have: People are tempted by all the great initial credit card offers but applying for too many cards can negatively impact your scores.
Avoid fees: Credit card companies charge fees for late payments even when it’s just a day or two. Making late payments may trigger a higher interest rate and show up on your credit report.
Pay off 100% of your balances every month: Carrying over balances from month to month is a costly way to do business and it can also show up on your report.