A perfect score of 850 may just be a technical perfection since it is very rare to see people with a credit score as high as this. A good perfect score usually includes the following: a mortgage that is over three years old, one or two auto loans that are more than two years old and less than five credit cards with very low balances that are over 2 years old.
Build up your personal credits
If you want to start out by buying things out of credit, you should enroll yourself first to credit card companies so they can already provide you with credit cards. You may need the help of a family member or friend to sign the papers for your first. These companies may also need proofs that you can pay your monthly bills. A good example is a letter of employment from your company.
Avoid delayed payments
Aside from not being able to pay late payment processing charges, paying on time is vital to maintain a good credit score. A single delayed payment can already have a huge impact on one’s credit score and every credit detail matters. If you have billing disputes, you can still pay on time and wait for your disputes to be resolved. Anyway, you will be receiving refunds in case your dispute gets approved.
Maintain a low credit card balance
It is always recommended to maintain a limit of 25% or below when it comes to your credit card balance. By doing so, it will show credit card companies that you are still interested in paying off your debts and is a good borrower. Some of these companies will even maintain or increase your credit limit.
Avoid too many credit lines
Instead of making you look reliable, too many credit lines will show that you don’t monitor and take care of your debts. If you have a credit card that has been inactive for a couple of months, make small purchases out of it or you can just cancel the card. Using them will reflect your capability to purchase and pay the bills on the due date.
Always pay the minimum on due dates
To avoid credit reports, always pay the minimum balance every due date. If possible, pay more than the minimum. Credit reports may lower down one’s credit score. Paying even the minimum balance will show that you are still trying to pay off your debts and is working on getting them paid.
Live within your means
If you own a number of credit cards, it does not exactly mean that you can just swipe them anytime you want and make purchases. Before swiping that cute plastic of yours, ask yourself if you can handle to pay the monthly bills. Don’t take on more debt that you can handle.
Keep revolving balances low
If you are planning to apply for significant loans in the future, reduce your balances at least 60 days in advance of your planned application date. This is because credit bureau balance updates are lagging and the credit scoring model puts major importance on the amount of your revolving balances.
Hire a consultant
If your low credit scores are consistent, it may be time for you to hire a consultant and pay him for credit repair. One’s credit is important and most credit repair services are affordable. Think of it as an investment.