Credit Management During the Holidays
Holiday shopping is fun (and stressful) at best but if planned well, it will not affect your credit score. Below are some important reminders when spending during the holiday season:
Don't sign up for new credit unless the savings is substantial. Many stores promote 0% interest on a purchase if you sign up for their credit card. This application will result in a credit inquiry which can affect your score negatively – do not add new credit unless the savings is substantial.
Do not put all your purchases on one credit card – Unless you plan to pay off the balance when the payment is due, charging more than 35% of the total credit allowed, can lower your credit score significantly.
Always pay at least $5 more than your minimum monthly payment each month. If you cannot pay down your balance, always pay a little more. This action, although it seems minor, can actually improve your credit score. Credit ratings are based, in part, on behavior patterns. A person who pays more than the minimum payment is less likely to pay late or overcharge.
These are simple actions that help to keep you in control of your credit and thoughtful of your spending. Wishing you all the joy the Holiday Season can bring!
ABOUT THE AUTHOR
Toni F. Ryan | NMLS#230507
Senior Loan Officer | Pinnacle Home Loans
Toni F. Ryan has over 20 years experience in mortgage lending - both on the wholesale and retail levels. She believes that education is key to making the best decision for YOU! She shares her insight into the lending world here and encourages your feedback. Don't forget to connect on Facebook!