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A Positive Credit Report Is Your Best Friend!

By: steve cowan

It is an unwritten truth about daily life in these early years of the century that credit cards are almost a staple requirement of getting through each and every day!

It is quite difficult, in fact, to think of a time before credit cards became so widespread, and equally difficult to survive in the modern world without one.

Nor is this trend towards a plastic based society likely to reverse any time soon, with more and more card providers entering the market at a time when consumers buy more and more goods and services online using their card.

But credit cards are without a shadow of doubt a very dangerous double edged sword, as I highlight in my free report “Death By Credit Card”. Whilst they bring a previously unimagined freedom and flexibility to millions of consumers, at the very same time, they can bring untold difficulties to millions of others!

This does not mean that people with poor credit records cannot get credit cards. On the contrary, it has never been easier for people considered to be a poor credit risk, to obtain a credit card.

Nevertheless, it should never be forgotten that, even though credit cards are incredibly convenient, they will also inevitably have quite an impact on your credit rating, and on any credit reports that are requested about you.

These credit reports are incredibly important, and it is vital that you are aware of this fact, and the effect poor reports can have on your ability to obtain any kind of loan.

Financial institution, banks and loan companies all use potential customers credit reports to ascertain whether that particular applicant fulfils all of the necessary loan criteria. In fact, these credit reports will often be the key determining factor, which is why you should be very careful that using your credit card never does leads any financial institution to put adverse remarks or comments into your report.

And protecting yourself against such a scenario is actually simplicity itself. All other things being equal, simply pay your bill on time every month, and you should never have any adverse credit report problems.

By acting in this manner, you clearly demonstrate to your lender that you are responsible, that you understand how to use your credit card properly, and that they can trust you with additional loan facilities in the future. This, in turn, will serve to raise your credit score, making it easier for you to approach other lenders for credit facilities as well!

Bear in mind however; that the more credit accounts, credit cards and loans that you have, the greater the total potential debt risk you are.

This may be a concern to any new lender whom you might approach, as it could suggest that, with all these outstanding payments, you might simply be unable to pay them back.
Effectively, although you might be attracted by the idea of having more than one credit card, it can actually be a negative point on your records, in the eyes of the lender.

It is not so difficult to understand why this might be the case. One view could be that this is a way of spending all of the available credit in your existing account, all the way to your limit, before moving on to another new lender. Thus, many potential loan sources would be very cautious in these circumstances, even though there is nothing adverse actually showing on your credit reports.

Whilst this may well not be your plan, credit card lenders will almost always fear the worst, and refuse to extend a new loan, or give you a credit card at all.

Thus, even though you have actually done nothing wrong, the assumption that you might do so could, in fact damage your credit score! The future lenders assumption that you could get up to financial mischief leads them to decline your credit card application, and, hey presto, you have just become a poor credit risk!

Something else that might seem to be an unfair influence on you credit worthiness is simply paying your credit card bill a few days late. Even such a small oversight can have a very negative influence on what appears on your credit report.

Even a few late payments of a few days only can easily end up in your credit repot, depending on how flexible and reasonable your credit card company is prepared to be!

That’s right, whether this actually makes it as far as becoming a bad credit report is pretty much down to the discretion of your lender. They can, within reason, meddle with your overall credit rating at will!.

So the touchstone here is, stick to a couple of credit cards at the most, don’t max them out every month and generally be as sensible as you can with them. Play it safe and keep a careful record of how, when and where you use them, and you shouldn’t need to worry.

Never lose sight of the fact that, although it seems that a new credit card hits the streets every day, you should at all costs avoid getting suckered in, and never, ever get into the downward spiral of borrowing from Peter’s credit card to pay the bill from Paul’s!

Keeping a positive credit report should always remain your primary concern, and you should strive to make sure that it stays negative ratings free.

A positive credit report can be your best friend in times of financial meltdown.

Remember that the next time you are tempted to put just one more on the card!

Article Source: http://www.articlemap.com

Steve Cowan is a lawyer who now acts as a debt and management consultant to major businesses in Asia. You can get more debt advice and download his controversial free report Death By Credit Card at webbiz99.com/paydayloans



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