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    Edmundo Daco Jr.

    There are five factors that affect a credit score, namely: payment history, amounts owed, length of credit history, new credit, types of credit used. Among all of these, payment history and amounts owed affect your credit score the most. Payment history amounts to 35% of your credit score and amounts owed is 30%. That is a total of 75%. So you need to make sure to give these two the biggest effort.

    Payment history measures how you have been paying your debts. Timely or advanced monthly repayments for your loan or payments for your credit card bills will result to increase in your credit score. On the other hand, late payments or skipping monthly repayments won't do any good to your credit.

    Amounts owed, measures your credit utilization. The basic rule is, the more you maximize your available credit the lesser your credit score will be. The ideal amount of credit utilization is 20% or below. This means that if you have a credit card limit of $10,000, your monthly usage should be at $2,000 or below.

    Never maximize your credit card limit and pay your monthly dues on time. If you do these, you have a good chance to get an excellent credit score.


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