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Research: Avoid bad credit history and stay safe -

Loans and credit cards are the order of the day at present. With a huge customer base, and constant addition of new clients, these industries have opened a world of possibilities for the average individual. Although it might seem a nice situation from the user`s perspective, you have to make sure that you carefully plan out the repayment of any debt you might have incurred. Inconsistencies and delays in payments schedules can give you bad credit history, which makes you an object of suspicion for all financial entities.

Bad credit history is the worst kind of financial situation that can affect a person. It significantly harms the possibility that you would ever get a loan or credit card, and has deeper implications which can make life difficult for you. While it is easy to get bad credit history, it is extremely difficult to repair the damage and get back a clean slate. It is always best to know the exact things that should be avoided to make sure your credit record is kept clean of any blemishes and you don`t run into roadblocks later on.

Pay on Time

Be it loans, EMI`s, credit card bills or taxes, the best financial practice that will keep you out of trouble is timely payment. Many of us indulge in the habit of delaying payments until the last moment. While it might seem an easier option to pay the minimum monthly due in case of a credit card, it will only push you deeper into debt as your principal will keep augmenting. In case of loans and taxes too, timely payment is essential to keep your credit record clean. Pay bills and taxes on time, and you will be safe from a bad credit history.

Count Your Liabilities

Credit cards come in a variety of attractive packages and added features, but having too many of them can have a pronounced negative effect on your credit score. Avoid taking more credit cards than you need, and always make monthly repayments in full. Likewise, tax payments have to be made on time to stay away from tax liens. If you have defaulted on a loan, make sure you clean it up fast. These stay on your record for a long time and may take time to clean up. Worse, it might not be possible at all to repair the damage. Tread carefully, and you can avoid bad credit history.

Transparency Pays

Always keep your financial dealing clear and above board. Complete transparency is always a bonus, and helps your credit records maintain their integrity. If you default on payments, pay them in full as soon as you can. It is also a good strategy to make sure that you report your financial dealings to major credit reporting agencies. This is so that they remain updated on the proceedings and can give a positive assessment of your credit record if approached by a financial establishment. Keep these in mind, be smart with your payments, and you will never have to deal with bad credit history.