If you
have a lot of
debt, your credit
score will
suffer.
Paying down your
debts to a minimum
will help elevate
your credit
score. For
example, if you
have a $1000 limit
on your credit
card and you
regularly carry a
balance of $900,
you will be a less
attractive credit
risk to lenders
than someone who
has the same
credit card but
carries a smaller
balance of $100 or
so. If you
are serious about
improving your
credit score, then
start with the
largest debt you
have and start
paying it down so
that you are using
a less large
percentage of your
credit
total.
In
general, try to
make sure that
you use no more
than 50% of your
credit.
That means that
if your credit
card has a limit
of $5000, make
sure that you pay
it down to at
least $2500 and
work at carrying
no larger
balance. If
possible, reduce
the debt even
more. If
you can pay off
your credit card
in full each
month, that is
even better. What
counts here is
what percentage
of your total
credit limit you
are using - the
lower the
better.
Tip
#7: Have a
Range Of Credit
Types
The
types of credit
you have are a
factor in
calculating your
credit
score. In
general, lenders
like to see that
you are able to
handle a range of
credit types
well.
Having some form
of personal
credit - such as
credit cards -
and some larger
types of credit -
such as a
mortgage or auto
loan - and paying
them off
regularly is
better than
having only one
type of
credit.
Follow
this link to
continue to the
next step:
Credit Score Security.