Tips on Building Credit History

credit_cards-115x115Good credit is a very important aspect of life, allowing you to make major purchases like cars and homes. Having good credit history is an important aspect to maintaining a good credit score. To keep your credit score moving upwards, follow these tips on building credit history.

Make Payments on Time

Having credit history is useless if it is not good credit history. It is extremely important to make your credit and loan payments on time and to at least pay the minimum amount due. One way to ensure your payments are on time is to set up auto-pay with your bank. You must still check your statements each month to ensure that you are submitting the correct amount and by the deadline. The amount due can change based on your usage. Due dates may vary based on the number of days in a given month.

Do Not Close Accounts

Once you pay off a credit card balance, do not be so quick to close the account. You should keep the card to maintain your credit history and show that you have credit available that you do not need to use. Having available and unused balance shows that you are not heavily relying on credit cards, which is interpreted positively.

Use Your Credit Cards

As good as it might feel to have a credit card without a balance on it, it is actually better to use your card a little bit each month and pay off the balance when the statement arrives. Credit card companies only report to the credit bureaus if you have some type of activity on your account. Each month that you have a charge or a payment is a reason for them to report activity.

More Tips on Building Credit History

By following the above tips on building credit history, you can ensure that you keep that history and your credit score in good standing. After all, without good credit history, it will be much harder to find your next car or your perfect family home. For more tips and guidance on building credit history, contact FIT Credit.