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5 reasons to avoid bad credit history

Bad credit history translates to a bad credit score, which in return translates to poor credibility. Loss of credibility is something that no one should like or be comfortable with. Moreover, bad credibility often leads to many financial losses too, if you look at your affairs closely. So although sustaining your credibility and good track record is a valuable motivation, there are financial incentives involved too that should push you to repair your bad credit history. Here are 5 of the most popular and important reasons why you should try and avoid bad credit history at all costs.

To obtain lower interest rates

Those with a good credit history always qualify for cheaper debt. If you need a personal loan, mortgage or even a credit card, you would want the interest rate to be as less as possible. A difference of even 1% on the interest rate could amount to hundreds of dollars in the long term based on the size of the debt that you are looking for. Therefore you need to avoid bad credit history to recover from the cyclical process of spoiling your credit history further. The worse your credit history, the harder it becomes to recover out of it.

Ease of getting debt

If you need a payday loan, an urgent personal loan or even a holiday shopping credit card, you have a far better chance with a good credit history than you have with low credibility. This convenience is something that you should cherish and try to withhold at all times and the only way of doing it is by maintaining a good credit history.

Not just debt

These days credit history is the most notable mark of a person’s financial stability as well as an indicator of his or her spending and repaying habits. That is the reason even prospective employers and even landlords are requesting for credit scores, before completely trusting an individual. This makes it even more imperative for card holders to try and ensure good health of their credit history at all times.

Attractive rewards

Rewards like air miles and cash back offers are not really available for all card holders. They are only available for customers who have a very good credit history. With good credit history, you can save a lot of money through valuable discount points, cash back offers and discounts on air tickets. All these rewards eventually add up to substantial savings, thus profiting you over a period of time. In other words these rewards are a way of making your consistency and credit history count.

Bigger credit limits

It is not just the ease with which you get credit but also the credit limit that is bigger if you have a good credit history. A bigger credit limit allows you a greater breathing space especially during holiday shopping seasons or during vacations when the expenses are expected to shoot up significantly. A higher credit limit also ensures that your credit score isn’t affected due to a high outstanding balance.