5 habits that can get you a bad credit history

Advertising Disclosure

Credit-Land.com is an independent, advertising-supported web site. Credit-Land.com receives compensation from many credit card issuers whose offers appear on our site. Compensation from our advertising partners impacts how and where their products appear on our site, including, for example, the order in which they may appear within review lists. Credit-Land.com has not reviewed all available credit card offers in the marketplace.

Credit Card Applications » Research » Guides » Building Credit History » 5 habits that can get you a bad credit history

5 habits that can get you a bad credit history


Updated: December 26, 2012

By
Add to Favorites:
A Bad credit history is an indication that a credit card holder or a borrowing customer needs to be cautioned. Given that credit scores are increasingly being looked at as a measure of the creditworthiness of an individual, maintaining them at a decent level becomes imperative. Whether it is a new credit card you are applying for, a loan, insurance or even a job sometimes, your credit history might be checked to find out more about you and your habits. Here are some of the habits, which can quickly ruin your credit and should be guarded against. Multiple credit applications The more you seek credit, the more it will show that you are desperate for credit. It is always advisable to keep your credit cards to a minimum. If you keep applying for credit cards every now and then, it will be recorded on your history and give a bad impression to companies when they check with the credit bureaus. One card account is more than good enough to manage and develop a good credit history. Leaving outstanding balances month after month The rule of thumb is to always pay down your balances in full, every month. The moment you leave your outstanding balance for the next month, you are making it more difficult for yourself. Late payment is an indication of inconsistency, and hence your credit history. If you do this often, the credit card issuer can penalize you by raising the interest rate, making it even more difficult for you to pay it back. The other problem is that you are unnecessarily adding to your principal debt, in the form of interest and late fees. If you don't think you can make the payment in full, by the end of the month, you should not charge it on your credit card. Missing bill payment deadlines Missing too many bill payment deadlines when you had the money to pay them is really foolish to say the least. Procrastination is a bad idea and you would be doing yourself a favour if you manage to pay back your debt before the due date. Defaulting on loans Defaulting on your loans could really hurt your credit history. Doing it once is bad enough. Doing it more than once, is just not the right way to go about the credit which has been made available to you. This will really turn off your creditors, making you a highly risky bet. The interest rates you will be charged either by your current debtor or in future applications will also be sky high. Balance transferring very often You can do the odd balance transfer when you have a really good deal. But going for balance transfer way too often and switching cards, sends negative vibes about you to the credit card companies and other lenders. Credit issuing companies want customers who are loyal, not someone, who keeps transferring debts from one account to another. If you are closing the old card accounts, it will hurt your history even more.

Add to Favorites:
Get the latest news, articles and expert advice delivered to your inbox. It's FREE.

Related Research:

Interest Free Credit Cards: Pay No Interest Until 2019

Interest Free Credit Cards: Pay No Interest Until 2019

By Credit-Land, Posted: May 23, 2017

Carrying a balance on a credit card is wasting your money on interest fees. It is easy to avoid interest payments on purchase transactions by paying off the entire card balance by the due date each month. But what to do if you are already ... Continue reading
Dashlane: Password Management and Shopping Ease in One Simple Product

Dashlane: Password Management and Shopping Ease in One Simple Product

By Angela Rose, Posted: May 3, 2017

Are you terrible at remembering passwords? Are you so terrible, in fact, that you often use the same one for multiple websites? If so, you’re not alone. Continue reading
SoFi Making Lending Social

SoFi Making Lending Social

By Dar Dowling, Posted: April 26, 2017

Since 2011 SoFi, a San Francisco based online lending company, took the lending industry by storm, when they became the first online lender giving people access to affordable student loan refinancing. Continue reading