You may have heard that the key to a good credit score is making payments on time. If you missed or have been late in making payments to your credit source, the key is to change that immediately. Repayment hostory impacts your credit score significantly.
Past credit history makes up 35% of your credit score, the most impact of any other category.
A typical timeline for the repayment of credit is 30, 60, 90, and 120 days. After 150 days it is typically sent to be written off by the credit provider. After this point it is sent to a collection agency to try and collect. This negatively affects your credit score.
Missing payments or paying late negatively impacts your credit score and can lead to higher interest rates, late fees, penalties, and reduced credit limits. If balances are high, you could even end up with court judgments.
1) Keep your credit utilization below 30%
2) Use a tool to track your credit score like Trans Union
3) Limit how often you apply for credit
4) Set a plan to get back on track to pay bills on time
5) Set up automatic payments for credit cards, cell phone bills and lines of credit
The key to a good credit score is really tied to a good repayment history.