Things you don’t want in your credit history

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Credit Card Applications » Research » Guides » Building Credit History » Things you don’t want in your credit history

Things you don’t want in your credit history


Updated: December 26, 2012

This content is not provided by Citi. Any opinions, analyses, reviews or recommendations expressed here are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by the Citi.

Credit history is very important for every citizen. Whether you want a new credit card, a personal loan or a vehicle loan, the first thing that you should possess is a decent credit history. Even more importantly credit history cannot be built overnight. It takes years to build a good credit history and have a high credit rating which is why even students are advised to use student credit cards to start building some credit. Since credit history includes all the records of a person, including payments made, past expenditure patterns, loans etc. one must be really careful and ensure that it is clean at all times. Here are a few things which should be kept out of your credit history at all points of time.

Missing monthly payment of bills

Whether it is your cell phone bills, electricity bills or credit card bills, it is advisable to be consistent in paying those bills absolutely on time. Every time you miss one of the bill payments not only do you have to pay the late fines, your credit history also takes a severe hit. The more the number of missed bill payments the worse it is for your credit history and even worse for your credit score which will go down This is because if you don't pay your debt, in the form of bills, on time, your creditworthiness starts to come under a doubt. Hence it is good to give first priority to the monthly bill payments before you use your income for other needs.

Bankruptcy

This is one thing that can spell disaster for your credit history. There are some people who often choose this path to get rid of most of their debts, especially when they are under a mountain of outstanding dues and stranded without the means to pay them off. However, bankruptcy is one thing that is hard to get rid off from your history. In fact, even credit bureaus which offer to provide your credit history to companies you have applied to for loans or credit cards often have the right to show bankruptcy for a longer period of time than the normal bill payment and other credit related records.

Missed mortgage payments, foreclosures or going underwater

If you have a mortgage, missing monthly payments is not good for your credit history. Sometimes, people go underwater, and decide not to pay the mortgage payments going forward when the cost of the house is less than the mortgage amount left to be paid. However, this makes getting loans in the future very difficult.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
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