Here are 5 factors that determine your credit score:
1. Do you pay your bills on time? The answer to this question is very important. If you pay your bills late, or if you have an account that has been sent to a collection agency, or have filed for bankruptcy. This background will appear in your history and is approximately 31% of your score
2. How much is the amount of your debt? Some scoring models compare the amount of money you owe with credit limits you have. If the amount you owe is close to your credit limits, it is very likely to have a negative effect on their record. This factor affects 30% on your score.
3. How long is your credit history? A limited credit history or short can have a negative effect on your score. But at the same time, a short history can be overlooked due to other factors, such as making timely payments and maintain your account balances low. This factor affects 15% on your score.
4. Have you recently applied for obtaining a new loan? If you have recently sent many requests for a new account, it can negatively affect your score. This factor affects 14% on your score.
5. How many and what type of credit accounts do you have? Some of the credit scoring models consider the number and type of credit accounts you have. A combination of term loans and credit cards can improve your score. But having too many credit cards can affect your score. This factor affects 10% on your score.
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tips free of credit card debt:
If possible, do the payment of outstanding credit card bill as a whole on the interest-free period.
Use cash as a means of payment if possible.
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