When considering a loan, it's important that you first obtain a copy of your credit report in order to check for errors and see what type of loan you may be able to quality for.  

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While everyone realizes that missing payments or declaring bankruptcy will ruin your score, there are a few seemingly harmless money moves that can also tank your score. 

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Make sure to be careful and don't fall into the trap of "Low-Key" Mistakes.

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1.  Closing Accounts
 

You paid off a credit card.  Congratulations!  But be careful.  You may not want to close that account.

 

Many consumers are shocked to find that closing a credit card, even one you've paid off, may actually harm your credit score. When an account is closed, it can shorten your credit history or change your overall credit mix. If the ratio of used credit to available credit increases, it can hurt your score.

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2.  Having Too Many Cards

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Have you ever checked out at a department store only to be hit with credit card offer promising "10% savings on today's purchases"?  It may seem like a great deal, but be careful!

 

Applying for different credit cards may be detrimental to your score. Each application results in a credit check, and too many credit checks may be considered a risk.

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Also, since the amount of available credit being utilized is one factor in your credit score, these store credit cards pose a unique threat. Typicaly, store cars ttend to have low credit limits, making it more likely that you’ll use a higher percentage of your available credit, and therefore lower your score.

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3.  Stopping your Credit Card Usage

 

That's right.  You may think it's a great idea to save money and stop using your credit cards.  But, that's not always a good thing for your credit score.  Stopping your credit-related activities for a long period may make it more difficult for lenders and creditors to evaluate your application for new credit or services.   This could lead to a big shock when you try to purchase a home loan or apply for a car loan.

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Make Sure to Stay Informed

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If you don’t know where you stand, it’s a good idea to obtain a copy of your credit report at least once per year (one of the easiest ways is at www.annualcreditreport.com).  By staying on top of your score and your report, you'll be able to put yourself in the best financial position.

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When was the last time you checked your credit score?