Credit Report

Your credit score impacts more than your ability to secure a mortgage or car loan; it can affect everything from the amount of money you pay for insurance to the ability to secure the job you want. It’s easy to overlook your credit until you need to buy something, but the actions you take every day have an impact on your score whether you realize it or not. Keep track of your score on a regular basis to ensure you are truly where you need to be, and be particularly wary of these big score killers.

FICO Killers: The 5 Worst Things you can do to your Credit Score

Max out your cards (or worse, go over your limit): Utilization, or the amount of available credit that you are actually using, has a huge impact on your overall credit score. If all of your cards are maxed out, then you are utilizing 100% of your available credit and your score will suffer. Try to keep your utilization low, ideally under 30%, according to money experts at Investopedia.

Skip payments or pay late: Your payment history accounts for about 35% of your credit score, so botch a payment or two and your score will tank. A single missed payment can cause your score to plummet, and it will likely take a few months to see a rebound, even if you pay everything else on time.

Have a foreclosure, short sale or deed in lieu: Getting out of an underwater home is a relief in some ways, but a foreclosure will have a devastating impact on your credit. A foreclosure or repossession is pretty much the worst thing you can do to your credit; while a Deed in Lieu or short sale may look better on paper, these processes are also score killers.

Apply for a ton of new cards/loans at once: When you work hard to repair or restore your score, it is tempting to take advantage of that new number and apply for more credit. Every time you apply for a credit card or loan, that application might harm your credit. Too many new accounts or too many inquiries can lower your score, so a flurry of applications may do more harm than good if you are trying to build your credit.

File for bankruptcy: Bankruptcy is a good option as a last resort – but only when you have exhausted every other option. Repairing your credit allows your score to rebound naturally and does not have a negative impact on your score. Filing bankruptcy causes your FICO score to plummet and even excludes you from some loan products entirely for a time.

Learning more about what not to do when it comes to your credit can help you protect your score; even small changes can have a huge impact on your financial health and wellbeing. If you are concerned about your credit score or need help rebuilding or repairing your credit, our team of experts is ready to help. Contact us at 866-611-9531 or info@buildmyscores.com to learn more about your options and to see what professional, expert credit repair can do for you.