3 ways to maintain good credit

What do man’s best friend, your comfiest yoga pants, and favorite t-shirt have in common?

They all seem innocent… until they negatively impact your credit. Here are three ways to keep your favorites - and your strong credit - in good health.

1. Pay your bills on time.

Always. It sounds simple (and in theory, it may be), but unexpected needs arise from time to time. Maybe a significant life change creates an expense. Or maybe your car needs a repair. Or maybe, your dog decides to consume the bathroom’s entire repertoire of shampoo, suds, and cleaners.

So now you not only have to deal with Barkley’s impending bills from the vet, but you also have to factor in the extra cost of shampoo this month. You can’t be expected to live without your nectar- infused shower gel and rubber ducky, right?

Bills are like Barkley’s bad behaviors. You know you have to deal with them, and swatting them on the nose with a rolled up newspaper doesn’t solve anything. Best to just anticipate bills and prepare for them, because unfortunately, they’re not going anywhere soon. Take care of them on time, every time, and maybe also keep them out of Barkley’s reach.

2. Don’t stretch your existing credit too thin.

Credit is like a pair of yoga pants - don’t stretch it too tight. Focus on the right fit for you instead, which varies from person to person. Ideally, your comfort level should keep your balances at 50% of their credit limit. There’s a difference between responsible debt and debt that piles up. Not over-leveraging your existing credit facilities shows lenders you can responsibly handle credit obligations. We encourage business owners to keep their use to 50% of their limit on credit cards, which demonstrates responsibility and ensures flexibility should needs arise.

3. Only apply for credit when you need it.

Between coupons plastered to every seat in the stands and credit card-sponsored tents outside the stadium offering swag, it’s hard to leave a sporting event without “free” merchandise. “Free” almost always has a catch to it though, especially when handing over personal information is involved.

Every time you give your social security number to credit card companies, even just in exchange for a free t-shirt, they’re running a credit check on you. Sure, that sounds innocent enough, but be careful about how many credit checks you rack up.When you really do want a line of credit (and not just a free t-shirt), financing companies consider the number of times you’ve applied for credit when determining whether or not to lend to you. A high number of credit checks within a short period of time is a warning sign to lenders.

Keep credit checks for when you really need them and don’t let that too-small-to-wear-in-public t-shirt haunt your credit score forevermore.

To learn more about your credit score and what loans you qualify for, speak with a client advocate today.