Your credit score plays a big role in your life. It's going to be checked when you try to obtain a mortgage, loan, or credit card, and maybe even when you apply for a job or new apartment. A bad score could mean that you are denied altogether. If you do find a way to get approved for a line of credit with a poor rating, it probably means that the terms will be less favorable.

In other words, a good credit score helps you avoid the hassle of being denied, and it can save you a lot of money over a lifetime.

Five Credit Score Killers to Avoid

You'll want to sidestep these financial activities that drop your credit score more than others. Here are some credit score killers that you should avoid:

  • Paying Late
    Your payment history plays the largest part in determining your score. You'll want to make sure that you never miss a payment on any credit account. A habitual pattern of late payments will show up on your credit reports and hurt your score. Worse yet, late payments can remain on your reports for seven years.
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  • Carrying Big Balances
    Keeping big balances on your credit cards throws off your credit utilization ratio and increases your overall level of debt, which are two big credit score factors. It's recommended that you use less than 30% of your credit limit, but the lower you can get it, the better.
  • Closing Old Accounts
    You shouldn't close any old credit accounts because a longer history has a positive effect on your rating. It's also not good because it lowers the amount of credit you have available to you, which may increase your overall utilization ratio. Just keep your old accounts open and active by charging one item each month and paying the balance.
  • Identity Theft
    Identity theft can happen to anyone. To prevent it from happening, the best thing you can do is monitor your finances closely. You can get a complimentary copy of your credit report from each of the three major credit agencies once each year. It's best practice to get all three of them periodically throughout the year. Make sure to act quickly if you spot any suspicious activity.
  • Defaulting on an Account
    The most obvious credit no-no is defaulting on an account. Having a home foreclosed on, failing to repay an account, and filing for bankruptcy are three huge bombshells that will decimate your score. Your rating will feel the effects of these actions for the next 7-10 years. Treat these as an absolute last resort and try to avoid them at all costs.

Improving Your Credit

If your credit score isn't where you want it to be, a great way to improve it is to get a line of credit and pay it back. If you are in the market for a car, Drivers Lane can help you accomplish your credit repair goals. We have been helping people with bad credit find auto financing for over 13 years, sometimes for little or no money down. Get started by filling out our easy and obligation-free online application today.