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Get the Credit You Deserve

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by Southside Bank

We’ve all heard the phrase “bad credit happens to good people.” And unfortunately, it’s true. Unforeseen medical expenses, divorce, job loss–any or all of these events can have devastating effects on your credit, which can ripple out to other aspects of your life.

Having strong credit is an essential component of your overall financial health. We recently sat down with Brian Merritt, Senior Vice President, Consumer Lending Manager at Southside Bank for his five key tips on maximizing your credit.

As Brian explains, “Each person’s situation is different. When I visit with clients about how to best manage their credit, I can provide them with a more personalized action plan. But there are some simple factors that everyone can and should consider in order to optimize the credit available to them.”

Know what’s in your credit report: Visit annualcreditreport.com to obtain a copy of your report from all three credit bureaus (Equifax, Experian and TransUnion). Consumers may obtain a copy from all three reporting agencies once a year at no charge. Review the reports carefully, contest any inaccurate information and have them correct the error(s).

Use credit wisely: When obtaining credit, whether in the form of revolving accounts (credit cards) or installment loans (cars, boats, etc.), be sure the repayment terms match the use of the funds. This will prevent you from making payments on something months or years after you’ve stopped using it. It’s also very important to pay off debt as quickly as possible. Remember: the longer you carry a balance, the more interest you pay.

Limit your number of unnecessary accounts: Almost every retailer will offer customers a store charge account at some point, but that doesn’t mean you must say “yes” every time. Having more than one or two of these high-interest credit cards can have a negative effect on your credit.

Be mindful of how much you owe: A large part of how your credit score is calculated is based upon the ratio of the outstanding balances vs. available credit. When this ratio is high, it can drive your score down. Keeping this ratio low will also help you avoid having more debt than you can comfortably repay.

Use discretion when opening new accounts: One factor that many lenders consider is the average age of your accounts. Longevity makes a good impression on lenders, so the higher the average age, the better. New accounts lower the average age and can impact credit worthiness, especially if you are a relatively new borrower.

The bottom line? It’s important to make the most of the credit you have and to manage it wisely. Implement these simple steps and get on the road to getting the credit you deserve.

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