• Seven Things That Could Be Harming Your Credit Score


    There are things you can do to improve your credit. Most people know what they are including paying your bills on time. However, there are a surprising number of things that can hurt your credit rating, and many people are not aware of what they are. The following are seven actions or inactions that can hurt your credit rating. Many can be avoided, so pay attention to which ones apply to your personal finances.

    Applying for too many credit cards or loans

    Every time you apply for any type of credit card or loan there will be an inquiry noted on your credit report. This also includes such things as applying for a new phone service contract. Too many of these inquires will lower you credit rating slightly. Most people will not notice a change in their credit unless they have a very high credit rating.

    Not paying your utility bill

    Although you get no good marks for paying your utility bills on time, if you do not pay them your credit can be negatively affected. Setting up an auto bill pay online can often help you avoid missing these monthly payments that can slip through the cracks.

    Not using a credit card for a long time

    You may have tried taking the advice of some finance gurus and sticking your credit card in a block of ice in the freezer to stop you from overspending. Surprising enough, credit agencies take periods of activity into account and will lower your score slightly with accounts that are not used.

    Closing a credit card account

    Closing a credit card account can hurt your credit score because your total available credit is a factor in computing your overall credit score. When an account is closed, you will have less credit than previously available.

    Not paying your parking tickets

    Many municipalities will turn over outstanding parking tickets to a collection agency and report the unpaid tickets to a credit agency. Not every city will do this, but there is no reason to take a chance with it. Always pay your parking tickets to avoid having them show up on your credit.

    Bankruptcy

    Often a person will have to declare bankruptcy and a few years later not realize that the bankruptcy is still on their credit report. Bankruptcies can stay on a credit report for up to 10 years. When it is finally dropped from the credit report your credit rating will shoot up.

    Inaccurate information

    This is a huge factor in many credit ratings. Few people are aware of the amount of inaccuracies that are listed on their credit report. In most circumstances, this information will be harmful to a credit rating. It is for this reason that you need to check for problems by getting a copy of your credit report. Keep in mind that there are three different credit agencies.

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