Top Ten Credit Facts You Should Know

Content from author Rodney Anderson

  1. Your credit score can affect your auto insurance rates more than your driving record. Contact your insurance agent to see if your rates are adversely affected. If they are, shop around.
  2. When getting divorced, make sure your attorney has a copy of your credit report when negotiating who will be responsible for which debts. Also remember, just because a debt is awarded to your ex, doesn’t mean you’re not still liable, and your credit is still at risk.
  3. When getting married, it’s imperative to review your future spouse’s credit report. Never say “I do” without full disclosure, or you’re headed for a marriage full of trouble. Financial secrets are a big red flag.
  4. Pay your credit cards off in full (and don’t use them) 45 to 60 days before applying for a loan. This helps to maximize your credit score, providing you the opportunity to take advantage of the lowest interest rates available.
  5. When you cosign for another person’s debt, you are equally obligated on the loan, and are committing to make the payments if they don’t. Think twice before co-signing for anyone.
  6. Closing your accounts and cutting up credit cards is the fastest way to kill your credit scores. Understanding credit capacity is essential to managing your credit.
  7. Paying off collections doesn’t necessarily boost your credit scores. Many times it has the opposite effect. Make sure you have a plan, and know the impact before you act.
  8. The fastest way to reestablish credit after bankruptcy, foreclosure or other credit catastrophes is secured credit cards. Secured credit cards give people an opportunity for a fresh start.
  9. Don’t fall for credit repair claims and “sounds-too-good-to-be true” advertising. Anything a credit repair company can do, YOU can do yourself. Don’t throw away your money.
  10. Never open a department store credit card to save 10%. Retail store cards are provided through finance companies, and can wreak havoc on your credit scores.

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