What’s Credit Got To Do With It?

Credit is important in our daily American lives. Unless you are gifted with loads of cash, it will be the determining factor in obtaining utilities, buying a car, renting a home, and of course, buying a property. For the most part, the more mature consumer has a higher credit score. This is due to many factors. A longer history of having established credit leads to a higher score. The total amount owed and the diversity of the credit will affect the overall credit score, but ultimately payment history and length of time the credit account has been in existence makes up a large portion of the overall score.

Younger consumers face uphill challenges with attaining a higher credit score due to the lack of time they have had credit established. They may not have a large portfolio of credit such as a mortgage, car loan, credit cards, etc. but many do have student loans, and possibly a credit card or two. This is a great place to start for establishing that much needed (and tracked) credit history.

A few tips to obtaining stellar credit scores include making payments on time, using credit responsibly, and avoid applying for a line of credit frequently. Avoid carrying high balances on your cards, and pay down your debt to keep your balance less than 35% of your total available credit.

Many banks and credit card companies are offering free score analyses these days, so keep track of your credit balance and score and you will be on your way to your home or investment purchase soon!