5 Thing that ruin your credit and how to avoid them

Your credit’s lousy, and somehow it just got worse. You’re not even sure how it happened. You’ve been making your payments, you’re not a loser. Here’s 5 Things that screw up your credit that you probably don’t know about.

#1 Closing Old Credit Cards
When you finally pay off that credit card, it seems like the smart thing to do is just chop it into tiny pieces, call up the company, and close it down completely. No temptation, no consequences. You are finally free of the credit card! It has no power over you. You are no longer being drawn to the Dark Side.
Sorry, Luke. Turns out your credit rating isn’t going to get rewarded if you remove the temptation. It’s only going to reward you if you get tempted and deny said temptation. Be strong.
A credit report with old accounts looks good on your report. The aged accounts give you points, just for having had a credit line open that long. Go bury them in the backyard if you want to make using them hard on yourself, but don’t close them out with the company.

#2 Using Up All Your Available Credit
You have a credit card with $3,000 available credit. That means you can spend $3,000. Because that’s what’s AVAILABLE. Right?
‘Fraid not. Credit card companies are sneaky like that. Truth is, your balance-to-limit radio is going to have a big effect on your credit. You want your balance (the amount you spend) to be only 20% of your limit (the amount that’s available). That means that $3,000 credit card should only have $600 on it if you want to keep your credit shiny clean.
If you really need that credit to get through the day, call up your credit company and find out what day of the month they report your balance to the credit bureaus. If you pay your bill just before that day, the amount reported to the credit bureau will be as low as possible.

#3 Applying for Too Much Credit
When you’re hurting for cash, your impulse may be to fill out as many credit card applications as possible in hopes that one will come through. This is actually a good way to make sure NONE of them come through, since lots of inquiries damages your credit report and makes those credit card companies less likely to give you credit.
Allow there to be 6 months between every applications. Let your old cards get older (see our advice on #1) and don’t get new stuff. Credit card companies are watching.
Yeah, it’s creepy. But it’s true.

#4 Not Paying Late Fees
When you’re late or over the limit, credit card companies charge you a fee. We’ve all gotten these, and they suck. The problem isn’t the fee, though. The problem is when you only send your regular payment, and don’t include the fee.
The fee will roll over and it will be considered 30 days late. Not only will that get you another fee, it’ll show up on your credit report. It’s a vicious, vicious cycle, and it’s sneaky too. Out-sneak your credit company and enclose the imposed fee with your payment.

#5 Moving
We’re not saying you shouldn’t move. But seriously, you would not believe how many times a day we see angry people whose companies didn’t forward their bills in time. They got late fees, they got dinged credit reports, and they’re pissed.
They should be pissed. It’s a lousy policy on the part of the credit companies. If they wanted to get good customer service points, they’d be all over sending your bill to the right place.
Unfortunately, they’re more in the business of collecting late fees. They don’t care that you’re upset. You have to be in charge of your own bills.
You know what date your bills are due. Set up online bill pay, write the due dates in big letters on your calendar, do whatever you have to do, but don’t rely on the postal service to get your bills to you on time.
Seriously, the postal service? That’s dangerous even if you’re not moving. Join us in the 21st Century. Set up an alert on your computer or have your email calendar remind you. Use your cell phone. Make it happen.
You know when your favorite TV show is on, right? We’re going to go out on a limb here and say that keeping your credit score high is slightly more important than what happened on Lost this week. What happens on Lost isn’t going to make any sense, anyway. There’s no reason your credit report should be the same.