3 Things that Can Ruin Your Credit and Lower Your Credit Score

Everyone wants to keep their credit file in great shape but in these tough economic times that no longer appears to be a reality. If you lose your job then you have no income, at least no enough, to pay your debts and keep them up to date. There are three things that will ruin your credit and they are as follows:

Late Payments

When you are late with your payments it will really lower your credit score and some derogatory credit can remain on your credit file for seven years or longer. Your credit won't stay ruined but it will take some time to repair it. As time goes on the late payments will have less of an impact on your credit score. If you receive, a judgment or file, a petition for bankruptcy those items, will have even more of a devastating impact on your credit report. After bankruptcy it may take 2 or 3 years before you can reestablish your credit. Newly established credit will to help raise your credit score. As time goes on and you continue to pay your new credit on time your score will increase.

The amount of debt

If you have too much debt it can lower your credit score especially if you are using up too much of your available credit. Paying down your debt will help you bring your credit score back up. Never close out accounts after you pay them off because this can help to lower your credit score even more. Once you pay your debt down it would be a good idea to keep it down.

Inquiries

If you have too many inquiries on your credit file it can lower your credit score. Inquiries can remain on your credit file for two years. Every time someone looks at your credit report they leave an inquiry and if you receive too many during the course of a month you will actually see your score lowered. As time goes by inquiries have less and less of an impact in terms of lowering your credit score even if they are still on your credit file. Sometimes there is a tendency to apply at one place for credit and get rejected and then apply for credit somewhere else and once again receive a rejection. If you are rejected twice chances are you will be rejected the 3rd and 4th time as well. You may as well call it quits right there and don't do any more damage.