Top Ways to Damage Your Credit Score

Your credit score is so important in today’s world since it is looked at not only by creditors, but also by insurers, employers, and landlords. We talk a lot about ways to improve your score, but what are the top ways to lower your score?

• Bankruptcy. This will do the most damage. Not only does a bankruptcy dramatically reduce your score, it can stay on your report for up to 10 years. You might qualify for credit before then, but it will be at higher rates and restrictive terms.
• Derogatory Public Records. These include suits, judgments, and foreclosures. Again, these will reduce your credit score and stay on your report until released by the court.
• Ongoing Late Payments. A history of being more than 30 days late with your payments will cause your score to drop. The longer the track record of late payments, the more damage to your score.
• Too Much Debt. Maxing out your credit cards lowers your score. Keep your balances low, preferably using only 30% of your available credit.

The bottom line is to try and avoid these things at all costs. The good news is that what you are doing today has more impact on your credit score then what has happened in the past. So today is the day to start paying down your debt and making on time monthly payments to your creditors. Your credit score will improve as a result.