How to manage your credit cards!

How To Manage Pay Off Debt: 6 Strategies that will work:

The first thing you need to understand: Debt has a ripple effect across your entire financial banking, including your credit scores.

Here are two major types we’ll discuss in these important topics:

Revolving –Debt: Comes from credit cards, where you can carry a balance from another month to month. You can borrow as much money as you’d like up to predetermined credit-limit-and interest rates are subject to change.

Installment Debt: Comes from mortgages, car loans, student loans, and personal loans. In most cases, the amount of money you borrow, the interest rate, and your monthly payments are fixed at the start. With both types of debt, you must make payments on time. When you miss a payment, your lender could report it to the credit bureaus as a mistake that can stay on your credit reports for seven years.

Aside from that, the way each type of debt affects your credit is quite different with installment debt, like student loans and mortgages, having a high balance doesn’t have a big impact on your credit.

But- revolving debt is another matter if you carry a high balance on your credit card from month to month; it will have a negative effect on your credit especially if you’re doing it with multiple cards. Your credit card is negatively affected because the amount of available credit you’re using also known as your credit utilization- carries significant weight in calculating your credit scores.

To manage good credit, status keeps your balances as low as possible on your credit cards. For example used lease 30% of your credit balance and always pay it back before the due (Date) and you will never get hit with interest rate on zero balance on your credit card.

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