Learning Center
Basic Finance
How Credit Affects You
Preparing for Home Ownership
Steps for Buying a Home
Life as a Homeowner






 
Additional Resources
Module 2
How Credit Affects You
Basics of Credit
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Tips
Quick Tips for Managing Credit edge
  1. Always pay on time and pay more than the minimum amount due. This helps protect your credit rating and reduces the amount you will pay in finance charges and total interest. If you realize you cannot pay on time, call your creditor and explain the situation. You may be able to have late fees waived.
  2. Before you decide to buy something with credit, consider the additional cost of using credit. How much more will you pay by using credit rather than paying in cash? Interest fees can really add up over time!
  3. Check your monthly statements to verify charges. If you find errors in your statement, call the creditor right away.
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How Much is Too Much?

The Right BalanceIt’s important to have some credit, but too much credit can lead to serious debt problems. What’s the right balance? Some experts suggest limiting monthly creditor debt (excluding house payment) to 15 - 20% of take-home pay. However, you are the best person to decide if you have too much debt. Here are some guidelines to help you determine if you are in over your head — or are about to be:
  • You have more debt than you can afford to pay off now.
  • You struggle to make payments, even minimum payments, on all of your credit accounts.
  • You juggle a number of credit cards, keep maxing out, and then need additional credit.
  • You make only minimum monthly payments (or less) on credit card accounts.

Having Trouble Making Payments?
If you think you might have too much debt or are having trouble making your debt payments, contact a reputable, non-profit credit counselor for assistance.
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