The Good Credit Ratings Of Tomorrow A good credit rating is when a person or business has a favorable credit score calculated based on an evaluation by the credit reporting companies (usually Experian, Equifax and Transunion). The formula used to determine a good credit rating is determined by the individual’s credit history, liabilities and current assets.
Maintaining A Good Credit Rating A good rating is a generally score of at least 700. This rating, known as the A rating, will almost guarantee the acceptance of a loan. It is best to gain possession of your credit report in order to determine your credit rating. If your account payments are made on time and your balances are low because you have maintained payments accurately, this will cause your rating to rise. Another factor in your good credit rating will be whether or not you have any type of late fee. Although many creditors will allow a few late fees, the reporting of late fees to a credit bureau can be a hard hit to your credit report and destroy your good credit rating.
Watch Out For Late Payments Do not allow any late payments to be reported to the credit bureau. The credit report is thorough, in that it will have listed the exact amount of days you have been late and how many times, ranging from 30 days, 60 days and 90 days. After 90 days late, your credit report may show that this nonpayment issue has been sent to collections, which damages your credit rating tremendously. A credit history of a minimum of one year will be a good step in the acceptance of a loan. The longer your credit history, the better your credit rating will be. By developing a solid payment plan, you can put aside money that is owed to the credit card each month and make timely payments in full. This will show the credit agency how reliable you are.
A Good Credit Rating Can Save You Money A good credit rating means less stress and getting loans at a much easier pace. Good credit ratings determine so many things in everyday living that maintaining a good credit score means a lot. Everyone starts out with good credit; the key is to keep good credit. Do not take out loans or credit cards that you cannot pay. Instead, start out with small limits and make payments on time. Keep your credit active for a year before applying for larger loans; this will leave room for developing a good credit rating. Don’t be stuck with a bad credit rating by taking on more than you can afford.