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How to Manage Credit Card Payments

By George Hauser
Published: Friday, November 13th, 2009

Almost, if not all of your financial activities are recorded on your credit report. Certain information on this document is used by credit bureaus to come up with a credit score. This number is then purchased from them by creditors, to help them decide on your credit applications. 

You could be one of the many people who have more than one credit card. And like most of these people, you can also be fretting over which among your credit cards need urgent attention when it comes to payments. Well, as many credit score tips go, you should pay all your credit card dues so that your score and your future credit worthiness would not suffer. 

These guides will help you manage your credit card payments a lot easier. However, if you plan to get out of a pile of debt, there are some other guides and credit score tips for that. 

Make the minimum on all your credit cards

Popular credit score tips advise consumers to maintain charging under the credit card limit. This is because when you charge more than your credit limit you will have over-the-limit accounts on your credit report, which then drags your score down. Other than that, you should make minimum payments on your credit cards, no matter what. 

If you can not pay even the minimum, your creditor will report this as a late payment. Also, your creditor can increase your interest rate because of this. Again, that’s added trouble on your part because it means additional dues. 

Get current on delinquent accounts

If you have failed to make payments on several of your credit cards, you should pay them as soon as you can. After paying the minimum in your credit cards, credit score tips will tell you to put your extra money on making your delinquent accounts current again. Remember that if you can not pay your credit card dues for 180 days, your account may be charged off. This report can kill your credit score. 

Bring out maxed out accounts below the limit

Many of those credit score tips advice consumers to avoid maxing our credit cards. It’s better for your credit score to have several dues on different accounts than to have one completely maxed out. But if you have credit cards that are already maxed out, you should make your payments regularly until your balance is below the credit limit once again.

Bring all high balances closer to $0

Remember that the lower the balances, the better. If you have credit card balances under the credit limit, that’s good but it may not be enough. It is still better to have balances 30% below the credit limit or closer to zero. This responsible handling of credit gets reflected on your credit score. 

Pay off balances with high interest rates

Though creditors have the ability to increase your interest rates, this is more reason why you should pay attention to accounts and balances that already have high interests. This makes it easier for you to get out of debt especially since interest rates are one of the primary causes of debt.

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