Credit is a key part of the economy, and it’s important to make sure you have a good credit score.The thing about credit is that it can make you or break you based on how it is used.

There are some things you should never do if you want to maintain a good credit rating. Here are 11 embarrassing credit faux pas that you should avoid:

Missing a payment

Missing a payment can have serious consequences for your credit score. If you miss a payment on your credit card, for example, that missed payment will be reflected on your credit report for about two years.

That could lead to higher interest rates on other loans, and might even disqualify you from getting certain types of loans in the future. Missing one or more payments on a loan also compounds the debt and can result in an early repayment penalty or even foreclosure.

So it’s important to make all of your monthly payments on time, no matter how small they are.

Closing a credit card

It’s important to be aware of the risks associated with closing a credit card account. Closing an account can impact your credit score and could lead to higher interest rates and other fees.

Take Care When Closing Your Credit Card Make sure you understand all the terms and conditions of the card before closing it. If there’s any question about anything, contact customer service immediately so that everything is taken care of properly.

Regular credit card applications

Every time you apply for a credit card, a pull is made on your credit score, which affects your overall score, sounds strange but it is true. Each pull on your score will affect you in a big way, so the more a lending agency pulls, the worse the result.

Since this practice will hamper your credit score, you should limit how often you apply for a credit card or credit in general.

Maxing the limit on your Credit

Some people mistakenly think that it is always a good idea to max out their credit cards in order to get the best interest rates. This is not always the case, and if you make some common negative credit mistakes, your credit score can take a hit.

It is better to stay under your maximum limit and also seek to pay back much more than the required limit given by the lending agency, that is the best approach possible.

Avoid a month to month balance

When you carry a balance month-to-month, you’re adding negative credit to your file. This could mean that you’ll have a harder time getting approved for loans in the future, and it could also mean that you’ll be charged higher interest rates on your existing debt.

It’s important to remember that carrying a balance can have serious consequences for your financial future. If you’re considering carrying a balance, ask yourself if there’s a better way to handle your finances. There are many options available to you, and it’s important to explore them before making any decisions.

Not only making minimum payments

If you’re only making minimum payments on your debt, you’re putting yourself at risk for negative credit mistakes. Even small amounts of debt can lead to big problems down the road if you don’t have the money to pay it back.

If you’re serious about getting your finances in order, make sure to make regular payments on all of your debts. That way, you’ll stay out of trouble and avoid having to deal with negative credit consequences.

Ignore reviewing billing statements

If you neglect to review your billing statement, you may be missing important information that could impact your credit score. By reviewing your statements regularly, you can catch any negative credit mistakes before they have a negative impact on your credit rating.

Checking your statements regularly also allows you to dispute any charges that you believe are incorrect or unauthorized.

Dismissing credit fees

Negative credit mistakes can have serious consequences, including higher APR rates, added fees, and decreased access to loans and credit. To avoid these problems, be sure to know your applicable APR and fees.

Check your current APR and fees regularly will help you identify any changes that may occur and ensure that you are aware of any additional costs that may apply to your loans.

Avoid cash advances

When you’re looking for a way to get the money you need, a cash advance may seem like the perfect solution. But there are a lot of risks involved, and it’s important to weigh them before deciding whether an advance is right for you.

When looking to avoid making a cash advance mistake, be sure to read the fine print and understand your credit score. Cash advances can be expensive and lead to negative credit scores if not repaid on time. Make sure you have a solid plan for repaying the debt in a timely manner, so you don’t end up with a delinquent loan that will haunt your credit score for years.

Final Thoughts

If you avoid these common credit mistakes that many people make, you can avoid credit faux pas that could prove embarrassing. The best way to avoid such miss steps and mistakes is to take the information above to heart and use to the best of your ability.