THINGS you should NOT TO DO WHEN YOU APPLY FOR A CREDIT CARD
1. APPLYING FOR A LOT OF CREDIT CARDS OR LOANS.
Each time you apply for credit, a hard inquiry is generated on
your credit report when a lender checks to see if you
Each hard inquiry drags down your score.
The effects are minor usually, three to five points.
Paying on time with a new card quickly erases the damage.
But when you apply for multiple cards at once,
lenders view this as risky behavior.
So apply for new credit cards strategically.
If you get rejected once, figure out why before you apply again.
Either settle for the card that fits your credit standing, or work to improve your credit so you do qualify.
2. Do not use up all your available credit
Your credit utilization ratio accounts for 30 percent of
your credit score. If you’re close to maxing out any
account, you’re considered a high risk to credit card companies.
The smaller your credit utilization, the better
it is for your credit score. According to FICO, those
with the best credit scores on average use less than
7 percent of their credit limits.
3. Don't Miss PAYMENTS
Only hard inquiries when a lender looks at your
credit when you apply for a loan or credit card have
a negative impact on your scores, and the effect is
small and temporary.
Your payment history accounts for the biggest
chunk of your credit score, weighing in at 35 percent.
Paying bills on time for as little as one month can raise
a modest credit score by 25 points.
4. YOU HAVE TOO MANY SUBPRIME LOANS ON YOUR REPORT.
Subprime lenders are companies which market financial products to people with bad credit. Subprime products tend to carry much higher interest rate
Lenders “look at what types of Lenders you are doing business with, and some of them take issue with applicants who come in with a portfolio of subprime lenders
5. TOO MANY RECENT APPLICATIONS.
Too many recent applications can be perceived as desperation for credit and this could indicate that you're taking on too many accounts in a short period of time,
Some credit card issuers deny cardholders who appear to be churning credit cards—that is repeatedly opening credit cards to earn the signup bonus.
6. JOINT ACCOUNTS AFFECT YOUR CREDIT SCORES, BUT THERE AREN’T JOINT SCORES
If you open a loan or credit card with a partner, the account
activity will be reflected on both your credit reports.
Joint accounts are different than authorized users,
but whenever you share credit, make sure you’re aware
of who will be responsible and who will be affected
if a payment is missed.
7. NEGATIVE INFORMATION EVENTUALLY AGES OFF
Different kinds of negative information will remain
on your credit report for different periods of time
(bankruptcy is an exception to this, for example),
but generally, negative information ages off your
report and no longer affects your score after 7 years.
8. CREDIT SCORES AREN’T THE ONLY THINGS THAT
MATTER FOR LENDING DECISIONS
A credit score isn’t the only thing lenders consider
when reviewing applicants.
If you have no credit or poor credit, you may
be able to secure a loan through an alternative
lender, and in some situations, making a personal
appeal or giving a lender more context to your credit
report can help you access financial products.
DID YOU CHECK YOUR CREDIT SCORE TODAY?
A WORD OF CAUTION ABOUT TRAILING INTEREST
Trailing interest is the amount of interest that adds up between when a credit card bill is sent and when payment is received.
It is also called Residual Interest.. It only applies when you carry a balance on your credit card
How do you get credit when no one wants to give it to you?
Why Its Important to know your score
To improve your score,
To apply for a credit card
To apply for a mortgage,
To apply for a rental To apply for a car loan,
To apply for a personal loan
© Copyright How To Get A Good To Excellent Credit Score To Qualify For Bank Loans