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Are you trying to grow and increase your credit score and avoid taking hits on your credit? Having a high credit score can help you to get approval for loans and make bigger purchases, like taking out a mortgage or buying a car.
Here are a few ways to avoid major hits to your credit score.
Pay Off Your Credit Cards
First, make sure that you’re paying off your credit cards on time. Make sure that you’re familiar with the time limit that each of your credit cards has for your payments. Then, ensure that you’re always making payments during those periods. If you need a reminder, try to set an alert on your phone to remind you to pay off your credit card.
Additionally, try to use your credit card like a debit card, meaning that you should only make credit purchases that you can afford to pay off immediately if possible. This will help you to keep up with credit card bills in a more manageable way. Paying off your credit cards on time will help to boost your credit score.
Pay Your Mortgage on Time
Another way to avoid major hits to your credit is to pay your mortgage on time. Paying your mortgage every month will help keep your credit score high. If your mortgage starts to become difficult to manage, look to sell your house and downsize rather than go into foreclosure.
You can also try to refinance your house if rates have dropped. Foreclosure can damage your credit score and make it hard to get loans in the future. Unfortunately, being forced into foreclosure can make your credit take a huge hit, even amounting to dropping 100 credit score points.
Don’t Max Out a Credit Card
Finally, if you’re trying to avoid major hits to your credit score, be careful to not max out on any of your credit cards. Even though some of your purchases might be more expensive, do your best to avoid maxing out your credit cards. Your credit score is not only determined by your payments but is also determined by your credit utilization. If they see that you’re maxing out on your credit card, that won’t give the impression that you can manage your credit very well. Try to pay off your card regularly so you never get close to maxing out your card. The lower your credit card expense balances are, the higher your credit score will stay.
So, if you’re trying to boost your credit score, remember the suggestions in this article. Make sure that you pay off your credit cards, pay your mortgage on time, and don’t max out on your credit cards. This will help you to avoid major hits on your credit score and keep it growing instead.
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