Factors Affecting Your Credit Score
Credit can be confusing, but understanding the factors that affect your credit score will help you to better manage your finances. Here are the most critical factors affecting your credit score:
Any new loans, or new lines of credit will increase your overall debt load and therefore will initially lower your credit score. As long as you maintain timely payments, your credit score will bounce back up. Your overall credit history has considerably more impact on your credit score than a single new loan.
Strategies to Improve Your Credit Score
These strategies will help to improve your options in securing the best financing necessary for your situation and help improve your credit rating:
All of these strategies work up to a point, there is a threshold based on the number of cards and loans you have open that will impact your credit rating internally with creditors. Consolidating and eliminating debt is simply the best way to improve your overall credit rating.
Strategies to reduce debt include negotiating interest rates with the credit card company, or making extra payments, or payments above the minimum monthly payment, to reduce interest charges and loan lengths. Consider transferring balances from one credit card to another with a lower rate as well as consolidating student loans, to help save on interest.
Please note that the content of this blog does not constitute tax advice and is only intended for the educational purpose of the reader. Please consult your tax advisor for specifics regarding your circumstances.
For more information contact us at 845.563.0537 or Contact@CompassAMG.com
Steven M DiGregorio is President of Compass Asset Management Group, LLC and an Investment Advisor Representative with Spire Wealth Management, LLC a Federally Registered Investment Advisory Firm. Securities offered through an affiliated company Spire Securities, LLC a Registered Broker/Dealer and member FINRA/SIPC.
About Compass Asset Management Group
Our boutique-style firm has an investment philosophy is both prudent and value driven. We combine research from the largest firms on Wall Street with three decades of market experience to provide strategic, tactical and dynamic investment management. Compass Asset Management Group, LLC delivers personalized financial planning, estate planning and investment management advice in a private setting with a high degree of sensitivity to your concerns and objectives. Our goal is to exceed yours expectations by listening closely, understanding deeply and communicating well through frequent, personal consultations entirely focused on your financial goals.
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