These factors lower my credit score, but I don’t understand it?
You opened 100% of your revolving accounts in the past 12 months.
This lowers your score. Having accounts listed in your credit reports is a positive factor because the payment history of these accounts shows lenders how well you pay your bills. Therefore, having too few accounts or too few open accounts may be considered negative. However, having too many accounts or adding new accounts too quickly may also be considered negative because lenders worry that you are spending (or preparing to spend) beyond your means, even if you have never been late with any payments. Note that closing accounts will not change this. Also, if you do not currently have credit, getting your first few credit cards may be difficult and may involve high fees, high interest rates, and low credit limits. Note that accounts from personal finance companies (which specialize in lending to people with credit problems) may be considered negative.
You owe debt on 100% of your revolving accounts.
This lowers your score. High balances are a negative factor because lenders worry that you are living beyond your means and may not be able to repay them. This is particularly true for credit cards. For installment loans such as mortgages and auto loans, lenders often use the proportion of the loan that is still unpaid to judge your ability to take on new debt. If very little of your installment loan balances have been repaid, lenders may not give you more credit that could add to your debt. In general, lenders evaluate how much you owe (your debt) in relation to how much you earn (your income). However, no matter how high your income, having a lot of debt may lower your credit scores because lenders know that adverse changes in your employment and life events such as divorce or illness may make it hard to pay your bills. Low balances, on the other hand, are a positive factor because lenders do not stand to lose as much if you become
unable to repay them. However, not using your credit accounts may be considered a negative factor, because it does not provide lenders with information about how you typically use credit and repay your debts.
I dont understand, I’ve never been late with one payment, and yet they say I’m in debt. So here are my questions:
– What is revolving account?
– How do I remedy these problems?
– Can someone translate these things in simple English?
Thx a ton!