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Are You Unknowingly Hurting Your Credit Score? – 5 Things You Probably Didn’t Know Can Hurt Your Credit Score


Things that Can Hurt Your Credit Score

Not Using Your Credit Cards at All

Has anyone ever told you that not using your credit card will make it look like you have a perfect score? Well, if they did tell you this, they are wrong. Using your credit card on a frequent basis is actually a vital component to having a good credit score. As long as you are using them responsibly and not missing any payments there is no problem with using your credit cards. In fact, if you do not use it, having less credit information can actually weaken your score. Try using your credit card on a minor payment each month, a gym membership, satellite radio subscription, etc.


2. Opening Too Many Accounts At Once Can Hurt Your Credit

Ever tried going around and asking every attractive person you saw out on a date? No one is attracted to desperation and the same goes for banks. If they see you are opening too many accounts all of a sudden, then you appear desperate and the assumption is you likely have a cash flow problem. Every time you apply for credit, it can lower your credit score slightly and if you apply to a lot of places within a short period of time, this can have a much larger negative impact on your score.


A Utilization Ratio Above Ten Percent

  • A utilization ratio is the amount of credit you have used compared to the amount that is available. The standard has always been a thirty percent or less utilization ratio if you wanted the best credit score. However, things change and it turns out ten percent is now the ideal number to have for a utilization ratio. So if your credit limit is a million dollars, then make sure you are not carrying more than $100,000 on your credit cards because not only will it hurt your credit score but you might also get robbed with that kind of dough.


Closing Your Credit Card Account

  • Many people think that closing a credit card account can only help your credit score since you are now no longer able to rack up any more debt.  However, if you are not using your credit card, your utilization ratio will be too. Having a utilization ratio that either too low or too high can affect your credit score in a negative way.