Keeping Your Credit Score UP

A good credit score signifies to lenders that you are a “good risk.” You are much more likely to pay back your debts and pay them on time if you have a higher credit score. Buyers are more likely to receive better interest rates have less trouble obtaining a loan with a higher credit score. However, sometimes even the people with the best credit scores can run into situations where credit score harm seems inevitable. For example, when people are injured or sick, then their income may suddenly drop or disappear. Job loss is also a common occurrence that may affect your credit score because you are suddenly unable to pay your bills.

A lower credit score can also affect your business merchant account. A decreased credit score may actually cause your payment processor to drop your business suddenly. If this happens to you, then there are still credit processing options. Find out more at eMerchantBroker.com.
There are a few things that you can do now that will help curb the effect on your score should the unthinkable happen. Consider the following tips:

• Keep credit card balances low.This seems like an obvious tip, but some people forget about this one. Even if you stop making charges on your card, the payments will continue regardless of whether you have lost your job or developed a medical condition. Making larger payments when you can will help cut down on interest now and decrease your overall balance so it is not a serious problem if the unthinkable happens. Of course, you should always be sure that your payments are at least the minimum (and hopefully more), and paid on time.
• Do not take out more debt until your current debt is paid off. Where you have made a major purchase, like a vehicle, avoid incurring unnecessary additional debt until that particular loan (or credit card) is paid off. This may mean that you must make major purchases slower, but it will prevent serious problems in the future.
• Fix credit report errors right away. Credit report errors can be a source of a negative credit score. Be sure to check your credit report yearly and correct any issues that you think are incorrect. Check with the Federal Trade Commission for advice and information about correcting errors and improving your credit score.
• Work out a payment schedule that works for you, if necessary. Should you have a sudden loss of income, let your creditors know about your problem before you miss a payment. They may be able to adjust your payments so that you can afford to continue making some payments on the loan. Some credit cards, for example, offer a service where you can suspend your payments for a certain amount of time. Talk to your creditor so you know all of your options.

When the unexpected happens, sometimes a credit score drop is unavoidable. But, follow these tips and the drop will be much less than it otherwise could have been.