What is a bad credit score – Credit Genie

What is a bad credit score

There are many factors which contribute to a bad credit score, these include missing payments, defaulting on loans and having high levels of debt.

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What is a bad credit score

Having a bad credit score can make it difficult to obtain loans, credit cards, and even rental applications. But how exactly do you end up with a bad credit score in the first place?

Late Payments

One of the most common ways people get a bad credit score is by making late payments. Whether it’s a credit card bill or a car loan, missing a payment deadline can result in a significant decrease in your credit score. It’s essential to pay all of your bills on time to avoid any negative impact on your credit rating.

High Credit Card Balances

Another common cause of bad credit scores is high credit card balances. If you max out your credit cards, it can negatively impact your credit score, even if you make your payments on time. The credit utilisation ratio is the amount of credit you’re using compared to your total available credit, and if it’s too high, it can negatively impact your credit rating.

Defaulting on Loans

Defaulting on loans, such as car loans, personal loans, or mortgages, can have a significant impact on your credit rating. When you default on a loan, it will likely be reported to the credit bureaus, and it will stay on your credit report for several years, affecting your ability to obtain credit in the future.

Applying for Too Much Credit

Applying for too much credit can also negatively impact your credit rating. Each time you apply for a loan or credit card, it generates a hard inquiry on your credit report, which can reduce your credit score slightly. If you apply for too much credit within a short period, it can have a significant impact on your credit rating.

It’s essential to be aware of these factors and take steps to improve your credit score, such as making payments on time, paying down credit card balances, and avoiding defaulting on loans.

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How Credit Genie helps

Credit Genie helps by identifying errors and inaccuracies in your credit report, disputing them with the credit bureaus, and working with creditors to negotiate the removal of negative items. This can lead to an improvement in your credit score and overall financial standing.

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