How Bad Credit Can Ruin You
Millions of people in America suffer from bad credit. If you are about to get out on your own and begin building a positive credit score, you need to know the pitfalls to avoid. Here are the components that create bad credit.
Credit Cards: The Dangerous Game
Credit cards can be both a blessing and a curse. They are probably the number one way that bad credit happens. It occurs because people fail to pay their balances off in a timely manner, miss even their minimum payments, and wind up subjected to bad marks on their credit reports. It is very important to keep abreast of your credit cards and not to let them get out of control. Don't buy anything you can't conceivably pay off at the end of the month.
Keep Your Credit Report Clean and Simple
It looks bad to credit agencies when you have a multitude of open credit accounts. Even if you are staying on top of all of them, they can contribute to bringing your credit score down. Keep just a couple of credit cards. Having a different card for every department store, every bank and every gas station is a sure way to make your credit report look sloppy and rough.
The Two Big Credit Killers
Bankruptcy and foreclosure are the biggest ways in which credit can go down the tubes in one fell swoop. On the other hand, sometimes there is no alternative. Black marks on your credit report last for 7 years before being wiped clean. If you have to declare bankruptcy or submit to foreclosure, begin working immediately to repair the damage done. There is no hurrying of the process, but you can make sure you are ready to make changes when the 7 years are up.
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