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How can you get good credit scores?

By Derek Brown
Published: Tuesday, May 18th, 2010

If you want to set a good record and better your financial health and life, it is imperative that you gain and maintain good credit scores. Good credit scores are those of around 700 or above 700. Get a score of 600 or lower, and you are guaranteed to have difficulty managing your finances and getting loans you might need.

So are there ways to increase your credit score? There definitely are, and they are actually quite simple. Remember these tips, and you’ll definitely boost your scores.

One thing you need to know about is that your credit scores are evaluated based on the amounts you owe, the number of credit cards you use, your payment history, how long you have been using credits, and your new credit. From this, you can gauge ways of increasing your scores.

First things first: one simple tip everyone must remember is honesty. Always reflect the truth in any reports you make, verbal or written. Lenders and banks put premium in honesty. When caught, it is very much likely that you would not be granted any more loans, or worse, sued. It would cost you much more money than what you may have achieved from cheating.

Another way is to apply for or keep as few credit cards as possible. Having too many cards imposes the high risk of spending too much. Having many cards is fine if you have a substantial amount of income, but the average working citizen would do best to keep only one or two credit cards. Also, signing up for too many cards is a bad sign for creditors that you are not responsible with your finances.

Always keeping track of your payment history is also an effective way of increasing your scores. This means that you must always be mindful of your spending habits and paying your bills on time. A good, clean paying history increases the lenders’ trust on you as a customer and would be good for future situations. Also, by keeping track of your bills, you would be able to assess your own capability of paying on time or not. In the event that you may not be able to pay on time, you should immediately contact your creditors and tell them so. Request a paying arrangement where both parties could benefit. Of course, how effective this strategy is depends on your paying history, and how often such situations arise.

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