Many times willingly or unwillingly, we commit mistakes that can affect our credit score negatively. Hence, it’s advisable to be aware of the factors that hurt your credit score. If you avoid doing the following things, it will help ensure a good credit score. Consistently being late on your credit card payments will hurt your credit score badly. Hence, you should always pay your credit card bills on time. When creditors think that you are not going to pay your bills or EMIs at all, they charge off your account. A charge off means your lender has completely given up on you. Another important part of your credit score is the level of debt, measured by credit utilisation. Having high credit card balances as compared to your credit card limit will increase your credit card utilisation and decrease your credit score. Next, you should not close your oldest credit card accounts. This is because lenders want to see a long credit history across multiple accounts to evaluate your repayment record. Lastly, if you apply for several credit cards or loan within a short period of time, your lender may interpret it as a sign of possible financial difficulty. This could reduce your credit score further. Hence, you should be careful when you apply for a new credit card online as well as offline. Check your credit score and confirm it adheres to the bank’s norms. Any rejection will dent your credit scores further.
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