Many people think that repeatedly subscribing to credit cards can be harmful to the credit record. However, the subscription is not the only element that makes up your score. Setting goals for the short and medium term, let’s see how to improve your credit report to take advantage of better credit card offers. In case of the credit repair Houston this is the best option now.

Build, improve or repair your credit report

The credit file intrigues a lot of people. Indeed, there is not much information on the subject and it remains unclear for the greatest number.

However, keep in mind how your credit score is calculated:

35% Punctuality

35% of your credit score comes from your punctuality to pay in time and your balances. That is, to be seen by its lenders as a good borrower.

If you want to increase your credit score, pay in advance each of your credit card balances without waiting for the statement to be issued.

Use

30% of your credit score comes from your monthly use of your different lines of credit granted by different lenders (mortgage, line of credit, credit cards).

Example:

Every month you use $ 2,500 of your available credit, consisting of a single $ 5,000 credit card. Your usage ratio is 50%.

You have 2 credit cards with $ 5,000 each, and always use $ 2,500. Your usage ratio will fall to 25%.

It is recommended to maintain a utilization ratio of less than 30%.

15% Historical

15% of your credit score comes from your credit history in Canada for all your lines of credit (credit cards, mortgages, auto loans, student loans).

An average is calculated to establish this score. Thus, it will be recommended to keep active an “old” credit card to inflate your average.

10% Types Of Credit

10% of your credit score comes from diversification in your credit types (mortgage, line of credit, credit card)

Lenders are reassured when you demonstrate sound management of your personal finances. The more different types of credit (correctly reimbursed each month), the better your credit score will be.

10% New Requests

10% of your credit score comes from your new credit applications (cards, loans). Each time you apply, your credit will be affected and will lose a few points.

These points are usually recovered in a few months if you comply with the above guidelines (including punctuality and utilization ratio).

Make up your credit report

If you start in the hunt for points & miles, that your credit report is very recent, we advise you to start with a credit card without annual fees and keep it as long as possible. There are more than a dozen. Keeping a credit card for many years allows you to inflate your credit history (15% of your credit score).