5 Habits of People with Excellent Credit Scores

Many people don’t have the luxury of getting loans whenever they apply because they have poor credit scores. Some are culprits of bad credit loan. Such people don’t watch their expenditure or have a habit of defaulting on their loans.

If you want to have a good credit score, there are specific habits you need to drop and traits to learn. Copy these five habits of people with excellent credit scores and see if you can follow suit.

They Maintain Credit Utilization Ratio at a Low Pace

Credit utilization is your debt ratio to your credit availability. So if your credit utilization ratio is high, that means you’ve overextended your financial being. But if you are at a low CUR, then you’ll have to keep up with repayments.

To achieve an excellent credit score, make sure you maintain low credit utilization. You can only achieve it by reducing any debt you incur as you limit your spending.

Excellent Credit Scorers Pay on Time

Can you live up to your loan obligations? That’s what most lenders are concerned about. By honoring your loan obligation, your FICO score will eventually rise. Adopt a habit of paying your loans on time.

Take care of your bills earlier enough before the deadline. You can turn to multiple monthly payments or use emails and text alerts when due dates are approaching.

You can opt for an automatic bill payment to ensure you don’t miss out on the deadline as you improve your credit score. Consider putting your due dates to around the same date. This way, you’ll take care of everything at once and not miss out on any payment.

Get the Right Credit Cards

Credit cards that can reward your pattern of spending are always the best. Make sure you use credit cards that provide cash-backs. You can then use the accumulated rewards to act as a reward statement when purchasing a credit statement.

Also, take note of the annual fee if it’s worth your earning. Some cards give you a year to decide whether you want to use them.

Build a good credit card score using the secured card as collateral if you’re getting started or have been bankrupt.  This can help you get back from bankruptcy or delinquency. Also, make a habit of minimizing how much bad credit loan you take.

Don’t Throw or Shut Down Your Old Credit

Old can be gold sometimes. Don’t throw away your old lines of credit. Your card can be rusty and dusty but is still active. Leave that account open.  You can use it later to reflect on your credit score.

Understand the Circumstances of Having a Credit Card

Is it essential to have a credit card? Many lenders have this question in mind before getting an additional card. Only apply for the credit card when necessary. Credit cards are virtual, and you can have as many of them as possible but don’t need all of them.

Make inquiries to multiple lenders within a short period to trim your score. Always choose the best lender for a loan pre-approval.

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