Factors that Affect your Credit Score

It is very important to maximize your credit score because this can affect whether you will be able to get a mortgage or a loan.  Even some potential employers now run credit checks!  You should be aware of the factors that can affect your credit score, which include the following.

Whether you had a bankruptcy

A bankruptcy can affect your credit score for years.  You may have trouble getting a mortgage or a loan for quite a while after you make this move.  Many lenders will not trust that you will pay them back since you did not pay your other creditors.  This is probably one of the worst things you can do to your credit score.

Making late payments to credit cards and other creditors

If you make late payments, then this can negatively affect your credit score.  Creditors like to be paid on time and the more tardiness is reported the lower your credit may go. 

How much debt you have

If you have a lot of debt your credit score might be affected. When you already have a lot of unsecured debt, some creditors might be afraid to loan you more money.  They may worry that you are just going to keep building more debt up and then will file bankruptcy or just stop paying people back.  This affects the many people deep in credit card debt.

You have a lot of available credit

When you have a lot of available credit such as many credit cards, your credit score may be affected.  Even when there are a lot of inquiries such as you just applying this can affect you. 

Of course there are things that affect your credit for the good.  Someone who has never had any credit at all does not have a perfect credit score.  You need to build it up.  You need to get some credit out such as by taking a loan out on a car or getting a credit card with a reasonable limit.  You should use it and then keep paying it off in time and in full every month.  As you do this more and more and show that you make wise purchases that you can pay for in a timely manner your credit score will go up to reflect this.

You want your credit score to be as high as possible.  The above factors may be influencing your score.