Mar
23
With banks and other lenders finally becoming cautious and making an attempt at social responsibility, credit matters. They want credit scores that are 20-40 points higher than last year for loans.
That said, learn here how to demolish your credit score so that lenders will not even consider you for the loan you want or need.
- Making late payments is the number one way to lower your credit. It’s tried and true. Just ask the millions of Americans that habitually pay late- it can really sink you. Companies that determine credit scores, like FICO, generally give 35% of your score to payment history. This means that a person with an average score can lose about 80 points from one late payment.
- Next, carry a giant balance on your credit card. This way, you’ll never be able to pay it off. As far as credit scores go, this one is sure to give you a drowning sensation.
- Open or close a credit line. Doing these things make you appear risky or flaky. For one reason or another, creditors don’t seem to anchor an interest in high risk customers right now. This is a sure-fire way to dunk your credit and become less credible to lenders.
- Finally, the single best thing you can do to crush your credit score is to default on a loan. Everyone loves a quitter. Companies, like FICO, who calculate your credit score for lenders recognize your “give up” attitude and pass along the cheery feelings by lowering your score for you.
If you worry about living on the edge, certain good behaviors like making on-time payments, taking out a small loan and paying it off and keeping a low balance, can get your score back up in the mid-600s or low 700s in a little over 2 years.