Factors that strengthen your credit history impressively

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Credit Card Applications » Research » Guides » Building Credit History » Factors that strengthen your credit history impressively

Factors that strengthen your credit history impressively


Updated: September 27, 2018

The content is accurate at the time of publication and is subject to change.

There are several factors that strengthen your credit history to make it impressive. A good credit history leads to a high credit rating which translates into a lot of benefits. You will get better rewards on credit cards, lower interest rates on debts you take and lower premiums on your insurance policy too. Here are some of the factors that will strengthen your credit history reasonably.

Low debt or no debt

Your credit history depends on your credit utilization ratio which is a measure of the extent to which you have used your available credit limit. It is the ratio of all your debts to the sum of your available credit. As your debt increases, the credit utilization increases thereby adversely affecting your credit rating. So you must keep your debt to as low as possible if you cannot repay it entirely. The key is to not spend on your credit card if it already has an outstanding balance. That is because for every expense you have to pay that added interest too when you finally repay the debt.

Consistent payment of bills

The credit history becomes very impressive and your credit rating is high when you make consistent payments on time. If prospective creditors look at your credit history and see that you have paid all your bills, whether it is credit card bills, mortgage payments, personal loan interest or insurance premiums on time, then you will be considered more creditworthy. In other words there is less risk involved in lending out money to you which is why you get the benefit of lower rates. So, you should never miss a payment date. You can in fact, set up automatic payments if that is indeed possible.

Good expenditure and timely payment

Your credit history is a reflection of what your income and expenditure status is. Those who benefit the most are card holders who have lot of expenses on their credit cards, but also make the payments on time. If you spend a lot without making payments you will end up with a debt. The key is to take note of all your mandatory expenses, whether it is bill payments, shopping for groceries, etc. and do as much as possible through the credit cards. This will leave an audit track. That is why the most rewarded lifestyle card holders are those who spend a lot but have a very low debt.

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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