3 Tips for Maintaining Good Credit

 

Having good credit is important for most people, as credit ratings are used to determine eligibility, as well as the interest you will pay, for car loans, mortgages, credit cards, and more.

To assist consumers in their efforts to build a solid credit reputation, Victory State Bank, Staten Island’s only community-based commercial bank, is sharing these tips from USA.gov:

1. Monitor your credit reports.

Understanding your financial habits — such as payment history and spending patterns — can help you improve them! Your score is generally based on information in your credit reportsMistakes on your credit reports could hurt your credit score, so check them regularly. Make sure to check that your reports don’t contain any errors, such as incorrect contact information, closed accounts listed as open, or an item like an unpaid debt listed twice.  

If you find something wrong in a credit report, you should contact both the credit reporting agency that produced it and the creditor that provided the information.

2. Pay your bills on time.

This is one of the simplest ways to keep your credit score strong — yet, with the bustle of everyday life, it can be easy to lose track of time and miss payment deadlines. Set up auto-payments or electronic reminders to ensure that you won’t be hit with late-payment penalties. Paying bills late can hurt your credit score, which in turn can raise your interest rate — meaning that you’re out even more money.

It’s a common misconception that the best way to improve a credit score is to pay off all of your accounts and close them. Get up to speed on your payments and stay on schedule, but be careful when closing accounts. Doing so eliminates some of the credit available to you, making balances appear higher when compared with the combined credit limit of all of your accounts. Also, if you managed an account well and made payments on time, closing it will remove all the positive benefits of your responsible credit behavior on your reports and score.

3. Don’t get close to your credit limit.

Credit scoring models look at how close you are to being “maxed out,” so keep your balances low in proportion to your overall credit. Experts advise keeping your use of credit to no more than 30 percent of your total credit limit. That means that if you have $12,000 of available credit on one open account, you shouldn’t use more than $3,600.

You can decrease your credit utilization ratio over time by paying as much of your credit card balance as possible each month. If you can, pay more than the minimum balance due; this will increase your available credit and decrease your utilization ratio faster.

Just like a shining professional reputation can take you far in your career, your credit score can make or break your financial status. To learn more about how to establish a stellar financial reputation, go to FinancialProtection.USA.gov.

About Victory State Bank

 

VSB Bancorp, Inc. (OTCQX: VSBN) is the one-bank holding company for Victory State Bank. As Staten Island, N.Y.’s only community-based commercial bank, Victory State Bank operates five full-service locations on the Island: The main office in the community of Great Kills, and branches in the communities of West Brighton, St. George, Dongan Hills and Rosebank. For additional information, Victory State Bank may be reached at 718-979-1100 or visited online at www.VictoryStateBank.com.

 

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