What is credit history and how to maintain it

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Credit Card Applications » Research » Guides » Building Credit History » What is credit history and how to maintain it

What is credit history and how to maintain it


Updated: December 26, 2012

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

Many people that are entering the country are unaware of the concept of credit history. In fact, for most people out there, this is still an alien concept, and one that is quite unlikely to make sense anytime soon. If you fall within this category, you might perhaps want to understand more about credit history and work towards maintaining it. In reality, this is not really such a complicated concept and with a little effort, you should be able to maintain reasonably good credit history.

First, you should understand that credit history refers to how an individual has been with her or his finances. It also reflects on how the individual has been able to manage their finances and whether or not this is something that has been a problem in the past. A good credit score, which is anything above 700, is considered to be a good credit history and hence, shows that the individual can manage their finances quite well. Poor credit scores fall under 500, which can make it significantly hard for the individual to get any kind of funding. Ideally, you wouldn’t want to fall in this category!

The question arises as to how you might be able to manage your credit score. This is not really all that complicated, and you should know that this is a fairly straightforward thing to look into. You can start off by paying your bills on time and ensuring that you don’t have any outstanding dues that are contributing to your credit in a negative manner. By repaying the dues on time, it is possible to ensure that you can hold onto a fairly decent credit score. Most people fail to do just this one simple thing, which is why they end up paying a lot of money.

Next, it also is feasible to perhaps restrict the amount of money that you borrow from an institution. This is another area where people can save money, but normally don’t and end up borrowing more. As long as you repay what you borrow, there is nothing that you need to be worried about. However, if you end up spending a lot of money and are unable to repay any of the debt, it will contribute to your bad credit history. This can take a lot of time to fix, which is why it is best to avoid it altogether in the first place.

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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