Break these now to create a better future. Your credit score is determined by individual credit reference agencies. These agencies use your credit report to do that – the same information that lenders will use to make decisions about whether or not to accept you for a loan, mortgage or credit card. So, it’s important to be aware of what your credit report says, as well as how the habits that you develop can have a very negative impact on it, especially if you already have a poor credit rating. Otherwise you will find it very difficult to borrow money on a loan and may need to seek out loans for people with bad credit when you need money for an emergency such as a car repair or boiler breakdown. Habit 1: never paying your bills on time This can be very dangerous to your credit health because as soon as you start missing payments these will begin to appear in your credit report. Even a single late payment on a credit card can cause your credit score to be pushed downward and if you have more than one this can be very problematic. Habit 2: sticking your head in the sand If you have personal finance problems then you need to get help as soon as possible. Many people who don’t, end up in serious trouble. The most obvious result of this is that you find yourself being pursued by a creditor that you owe money to, such as a credit provider or a retailer. If they should take you to court and get a judgment against you then this appears on your credit report for years afterwards and you will find it difficult to get credit again for some time. Habit 3: not checking your credit report The information in your credit report is as susceptible as any other to being incorrect. So, it’s crucial that you check your credit report regularly and ensure that you see there what you’re expecting to see. Correct addresses, as well as the right data on the credit you already have is essential – this will help you to detect fraud, as well as ensuring that what credit providers see is correct. Habit 4: not tidying up loose ends Anything, from an open but unused credit card to that personal loan you just forgot to make the last payment on can cause issues with your credit score. So, make sure you tidy up the loose ends of your personal finances and don’t leave unused accounts or unpaid credit there to create obstacles. Habit 5: not disconnecting from the past If you’ve been married, in a relationship or living with housemates then you may find that your credit reports have become connected. This can continue until you request a “notice of disassociation” from that person. The real problem for your credit score of continuing old habits of association is that if that person has a poor credit history they will bring your score down too. Habit 6: making multiple credit applications If you’re looking for personal loans or credit cards then it’s a good idea to shop around to find the right one. However, try to avoid submitting applications until you’ve made a decision about which one works best – and don’t make multiple applications at once. The more applications you make where a “hard” search is carried out against your credit report the less likely you are to be accepted – that’s because lenders see this kind of flurry of activity as a sign of someone who is unable to handle their current finances.