If you think you have a good credit history, but you have never checked it out, you might be in for a nasty surprise. It's not just keeping up your payments and being responsible with your borrowing that affects your credit score, there are some ways that you damage it that really shock you. Here are ten of those surprising things that could knock down your credit rating by a few points.
1. Having a company credit card
If your employer has given you a company credit card then that could be affecting your own personal credit score. Most corporate cards are now actually in joint names and that means that you are jointly liable for the credit. It also means that if your company pays their bills late, it will impact on your credit rating.
2. Using your debit card to rent a car
If you pay a deposit on a rented car with your debit card, then the car hire company will probably do a credit check on you. Every credit check that is made on you will take a point off your credit rating.
3. Paying a parking ticket late
No one likes getting a parking ticket and we like paying them even less. That's why so many people leave it until the last minute to pay them. If you leave it too late, the debt will be passed to a debt recovery company and that will dent your credit rating.
4. Taking out "buy now, pay later" credit
The amazing deals that you can get on furniture, where you pay nothing for twelve months and then its interest free for the next three years could also be damaging your credit score. They look like you have a maxed out line of credit against which you are making no repayments at all for a year.
5. Forgetting to take a library book back
Even something as simple as a library book fine might be recorded against your credit history. If you forget to pay a library fine, local authorities are very quick to pass that on to a debt collection company too, and that will knock more points of your credit score.
6. Waiting for the reminder letter on utility bills
Gas and electricity companies are pretty quick off the mark when it comes to late payment. If you slip up and leave paying them for too long, you will get a letter from a debt collection company and that means another knock to your credit score.
7. Paying off a loan early
Even paying off a loan early can look bad on your credit history. When you pay off a debt early, you save some of the interests, but that can look like you didn't pay back all that you borrowed.
8. Underutilising a credit card
Lenders are looking to see that you use credit wisely and manage your debts responsibly. If you have credit available, but you never use it, it still uses up some of your available credit and there is no history if your ability to manage credit if you never use the credit that you have available. It is better for your credit rating for you to use a credit card and pay back the balance monthly.
9. Enquiring about loans
Making too many enquires about loans, or getting quotations for loans, will also knock some points off your credit score. In fact, any hard credit check that is done on you will lower your credit score for a period of two years and that includes taking out a new mobile phone contracts as well.
10. Disputing an item on your credit card
If you dispute an item on your credit card statement and your lender takes their time looking into then it will remain an unpaid debt against your name and could still damage your credit score.