How to maintain good credit?

As you might already know it can be hard work to obtain a high credit score. It does not happen overnight. Establishing good credit then maintaining your good credit history does require a commitment to excellence on your part. You must continue to pay your bills early or on time each and every month including your credit cards, your loans, automobile loans, medical bills and any other debt you may have. Making your payments on time is imperative and demonstrates you care about your financial reputation and are reliable and trustworthy. Your credit history will affect important areas of your life such as renting a home or an apartment or purchasing a home along with getting insurance or even getting a job. The better your credit score and the longer you maintain a good credit history will benefit you by having lower interest rates on your credit cards, loans, mortgage, and so forth.

Don’t just squeeze by and live paycheck to paycheck.

Plan for emergencies ahead of time and build your saving account to cover at least 6 months of bills in case something bad happens like you lose your job or your car breaks down or another emergency that may arise. By having extra money saved up you will be able to continue to pay your bills early or on time should an emergency arise and this is what really matters when it comes to maintaining good credit. The truth is creditors do not care about your personal problems and certainly do not care about you. Regardless if you are sick, in the hospital or jobless lenders will report you to a collection agency or the credit bureaus “Experian, Transunion and Equifax” for being late on your payments and this negative history will remain on your credit score for 7 years just for being late by 30 days. This may seem harsh and it is but this is the truth and this is how it works.

What if you don’t have established credit or good credit?

If you do not already have credit established or do not already have a good credit score then there is no better time to grab the bull by the horns and start building or rebuilding your credit then right now.
Generally speaking it takes 3 or more years to establish your credit history with enough financial information about you for a lender to make a risk based decision to determine whether or not you can be trusted to pay your bills on time or repay a loan or a debt. If you are rebuilding your credit and you do not yet qualify for a traditional credit card then the next option you have is to obtain a “secured credit card” which is a special credit card you deposit money in a special account and that amount becomes your personal credit limit and because you are using your own money there is no financial risk to a credit card company. While you are also re-establishing your credit it is important you pay off all of your debts and make wise financial decisions to be responsible and trustworthy. All of this takes time but in the end it is worth the effort and hard work.

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