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Credit history is like a treasure you accumulate for years and years together. Messing up your credit history is just as easy as it is hard to construct a good credit history which might take years or even more. High income and expenditure customers who make their payments on time are the ones with the highest credit rating but here are some of the things you would want to avoid in your credit history as much as possible.
A lot of credit card customers have outstanding debts, which counts against their credit scores. One thing you will have to do right from the start is to make your payments on time. Every missed payment brings down your credit rating further. As you string consecutive months or years with consistent payments your stock with the credit card companies will eventually rise.
If you default on a loan or quit from a mortgage midway, you will get a very bad stain on your credit history that is hard to get rid of. Getting credit is difficult as is but when you have a loan default in your credit history, things get even worse and tougher for you. It is something you have to tray and avoid as much as possible. If you cannot pay your loan try talking to your debtor and reach a settlement so that your debtor doesn`t report your delinquency to the credit bureaus, although you cannot stop the lender from doing so even after a midway settlement.
Declaring bankruptcy seems to be a good option for some people drowned in debt. However, you must know that your credit history will suffer irreparably when you declare bankruptcy. For the next 7 years, bankruptcy keeps appearing in your credit report making it impossible for you to get loans or credit cards.
One of two balance transfers is fine if you are trying to avail the rewards. However, you should not overdo it. When you are jumping from one credit card to another, it shows you in bad light when credit card companies look at your credit history. Moreover, if you do a balance transfer, and close your old accounts this could lead to a loss of your credit history and reduction in credit limits, both of which have a negative impact on your credit history.
