It’s a question our customers ask frequently, so we’ve gathered some tips collected from some of the nation’s financial institutions that deal with consumer credit every day:
Using your credit cards can be tricky, so think smart when you use them. Ironically, even if you pay your bills in full every month, racking up large balances can put a dent in your scores. On the flipside, consumers are told to use their credit when needed, and keeping a low balance can actually increase your score. When they’re considering giving you a loan, lenders like to see a good payment history.
We all like to shop, but a lot of shopping for credit can reflect negatively on your report as well. BMO Harris Bank tells us that every time you apply for a credit card or loan, the inquiries appear on your report, so keep your applications to a minimum. Transferring balances, or combing all your credit card balances onto a single card may negatively mark your credit as well.
Requesting and checking your own credit report shouldn’t affect your score as long as you order it directly from a company authorized to provide consumer credit information.
Yes, fixing the errors on your credit report is important when you’re planning to buy a home or car — but keeping your credit report consistently healthy for the long haul lets you take advantage of lower interest rates when the banks compete for your business.