While applying for a loan, your biggest concern is to have a clean credit report. Negative information can stop you from getting loans and good rates. Following are the 10 credit behaviours that would affect your score negatively; you can improve your score by taking measures against these.

• Multiple credit lines: Too many credit cards on the report would only reflect your poor money management skills and it’s possibly the worst credit mistake. It’s true that prospective lenders look for multiple accounts in good standing but what they actually look for is the mixture of different credit lines, cards, mortgage, auto, student loans etc.
• Paying only the minimum on the bills: Making only the minimum payment would keep your credit balances high and thus would increase your debt problem. Hence, you must pay more than the minimum due each time. Ideally, the debt should not exceed 35% of the credit limit.
• Maxed-out credit cards: Maxed-out credit cards increases your risk quotient as a customer and it can make the creditors reluctant to offer you a loan next time. Even FICO penalizes maxed out credit cards by slashing the score.
• Avoid unnecessary late fees: Habit of paying the bills late can cost you in more than one way. Not only you’ll acquire late fees but the creditor may also decide to increase rates when you’re late.
• Avoid using high rate cards: It is wise to avoid using credit cards which carry high interest rates. Debts accumulate faster with high rate cards. Moreover, if you’re in the habit of paying only the minimum, you would soon find yourself struggling with debt problem.
• Be wise in choosing an authorized user: If you have decided to let someone else use your cards make sure that the person is responsible with money. Remember that you’re assuming the responsibility of repaying the loan when authorizing the other to use it. Otherwise, irresponsible use of the card by the user would tarnish your report.
• Closed accounts look bad on report: Too many closed accounts would also look bad on your report. If you’re not using certain cards, the bank would eventually close the accounts and report the same to the credit bureaus (CBs). You must stop this from happening by using the cards at regular intervals.
• Keep creditors updated with personal details: It is important to avoid the bills and statements getting misplaced and incurring late fees on them. It can lead to a serious debt issue. Hence, inform your creditors about your name and address changes immediately.
• Too much of credit shopping: This would make you look desperate for credit and the creditors hate to see that on report. Also, too many hard inquiries are bad for your score.
• Not having credit report: It may sound weird when we advice people so much against credit but credit report is an important document that helps in describing your financial status. Without an established credit report you may find it hard to get loans when needed. Hence you must have a credit report too.

Most often our debt problems originate from our ignorance towards debt issues when by following some simple steps we can stay clear from these problems. Hope this write-up would help you in correcting your credit mistakes.