Credit scores can help or difficulty in business and life. Building a good credit history is very important. Re ability after an investment or personal financial business is intensely frustrating, but fundamental to get back on their financial feet. These scores are used by everyone from banks to insurance companies owners to evaluate you. And it's not just about his personal life, like getting a mortgage or rent a house ... your business is affected as well.
1. Payment history
Represents the payment history for about 35 percent of your credit score. Payments made on time and in full have a positive impact; late payments, judgments, bankruptcies or financial cancellations have a negative effect.
2. Outstanding Debt
About 30 percent of your credit score is based on the amount of its debt. There are different calculations at play here:
the ratio of total debt to total debt available
the ratio of the total outstanding amount of each individual obligation to the amount of credit available on the credit card or loan
the number of accounts with balances
the amount owed on different types of accounts, such as credit cards, installment loans and mortgage debt.
Pay balances is an important way to improve your score. Keep balances on individual cards below 30 percent of your credit limit whenever possible. And always avoid reaching or going over credit limits on obligations or credit card debt. He is eccentric, but your credit score will improve if you separate balance around several credit cards instead of maxing out a credit card: to put $ 2,500 on each of the three credit cards each with $ 10,000 credit limits will be better for your score to put the $ 7,500 on a card with a limit of $ 10,000. The total amount due does not change, but the way they are perceived by the coast there are models. Obviously, the best thing to do is pay the entire debt as soon as possible and do not make late payments.
3. Credit history Time
The amount of time you have had credit accounts for about 15 percent of your score. In general, the longer your credit history, the better, because it allows lenders to see how it has managed its debt obligations over a period of several years.
4. Number of new credit
New applications for credit and loan accounts represent about 10 percent of your score. The opening of several new credit accounts in a short period of time can hurt your score. So be careful with balance transfers to new cards and 10% discount for opening a new credit card offer with retailers. Open new accounts to get the discount store that can cost your credit score, so do not do it if you are currently on the market for a mortgage or other loan.
5. Type of credit
The type of credit you have has an impact of about 10 percent on your credit score. A mixture of credit card debt, automobile, assembly and the mortgage is positive. A concentration of only credit card debt is not.
