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How to maintain a good credit report?

By Janet Lacey
Published: Sunday, October 25th, 2009

It is of utmost importance to maintain a good credit report. A good credit report can help you get approved for many of the loans. It gives you the best in student loans with very low interests. You can also buy a house or rent one out in prime locations with ease. You entire life will become a lot easier if you have a good credit score. What is a good score? A good credit score is FICO 740. If you have reached this score, you are going to get almost every loan you apply for and no lender will have a problem with you. Every lender considers 740 to be a great score and does not have any problems with it. Once you get to FICO 740, concentrate on staying there.

Once you apply for a loan or go to a lender of any kind, this lender will request your credit report. He will look at your report and decide whether you qualify for the loan or the service he is providing. Your credit report is also responsible for the amount of interest you pay. Thus with a good credit history, you can get approved for many loans with low interest rates. Credit histories start from quite a young age now.

If you have a credit card, you will have a credit history and a report documenting your financial behaviour. All of your repayments and other details of your financial behaviour are reported tot the credit report agencies in a timely manner. This credit history decides whether you get a new credit and at what rate of interest. The main criterion is your willingness to repay a loan. This indicates how likely you are to repay a loan and they use your credit history and your past repayments as measure of your willingness. A credit report will have any and all your financial information. It will have details of any debts you had, any loans you took details of accounts you have and credit limits on credit cards too. Information stays on these reports for typically seven years. Details about any bankruptcy filings or tax liens or missed payments stay for seven to ten years on your credit report and affect your credit score.

An important factor in your getting a good deal in any credits is your credit score. This is a number and depicts your financial history. It is a quick and concise method to decide your financial health with out having to go through your entire credit report. It is some times defined as the numerical forecast depicting an individual’s borrowing behaviour. Naturally, like with any other score, your aim is to keep the score as high as possible.

To maintain a good credit score and credit report, pay all your bills on time. Try and minimize your credit card debt as much as possible. Always charge your credit card according to your limits. Do not overcharge when you cannot afford to repay. Keep a tab on your credit report and correct any wrong information immediately. Do not have more credit cards than what you strictly need. Notify address changes immediately. Avoid buying new cards and closing old ones . A long credit card history gets you a better score.

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