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Keep the scores up: Maintain Good Credit Record
If you are going to apply for any mortgage loan, auto loan, personal loan or Federal Plus loan, your Good credit record will help you getting the things done easily. Then you will realize the value of good credit. Maintaining a good credit score is as important as to building a good credit.
In this piece of advice you’ll be acquainted with credit score, credit history and credit reports. Most importantly how to maintain your credit score and to build a good credit history.
What is Credit History
Credit history is record of all your open and fully paid debts or loans. Credit history is used to determine individual’s ability to repay debts is timely manner. So lenders use this information to before lending any sort of credit as person with bad credit history is of High risk to them.
What is Credit Report
Credit history when documented becomes Credit Report. Credit report will summarize that what type of loans you have, how did you pay them off, available credit, interest rates offered and record of credit checks. Most credit account information remains on your creditreport for up to seven years; bankruptcy, however, can remain for ten years. There are ways to obtain your annual credit report. The three major credit reporting websites offer free credit report once in 12 months. These are:
- Equifax
- Experian
- TransUnion
What is Credit Score
Credit scoring is a calculative method to discover the probability of your ablity to repay the debt. The "credit score" is a number that determines your ranking on how well you performed with repaying your debts. It is based on the credit account information in your credit report. It’s always better to have the highest possible credit score. High credit score can help you get loans at low interest rates.
Maintain Good Credit Score Tips
The following credit tips can help you maintain the highest possible credit score.- Make all your payments on time and make minimum payment due at least once a month.
- Minimize your credit card debt.
- Don’t open too many credit card accounts.
- Don’t spend income now that you hope to make later.
- Check your credit report at least once a year, so you can work out if there’s any error or false record.
- The longer the credit history of credit card accounts the better the credit score, so be careful about opening new credit card accounts and closing older ones.
- Inform your creditors immediately whenever your address changes so you get bills at right place and can repay them on time.
If you are planning to buy your dream house or your dream car, all you need is to have good credit history and a high credit score. The greater the credit score, the lower interset rates you'll get.
