Common Credit Mistakes to Avoid

Here’s a more detailed explanation of common credit mistakes to avoid:

1. Missing Payments: Even one missed payment can have a lasting negative impact on your credit score. It’s important to set up reminders or automated payments to ensure timely payments.
2. High Credit Utilization: Ideally, use less than 30% of your available credit. High utilization signals financial stress and can lower your credit score.
3. Ignoring Credit Reports: Regularly checking your credit reports helps catch errors, fraud, or negative items that can harm your score.
4. Closing Old Accounts: Keeping older accounts open helps improve your credit score by lengthening your credit history.
5. Applying for Too Much Credit: Multiple hard inquiries in a short period can make you appear risky to lenders, affecting your score.

Avoiding these mistakes is key to building and maintaining a strong credit score.