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How to Destroy your Credit in Nine Easy Steps

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A credit card on a stack of money.

Your credit follows you everywhere you go. It affects your ability to obtain a mortgage, vehicle or other financial assistance. If you don’t ever want to borrow money again, destroy your credit with nine simple techniques.

1. Pay your Bills Late

There’s no better way to lower your credit rating than to pay bills late. In fact, late payments comprise more than a third of your credit score. If you suffered a job loss or have a stack of unpaid medical bills on your desk, reach out to your creditors to make alternate payment arrangements.

2. Pay Less than the Minimum Amount Due

If you pay less than the amount owed, creditors will mark your account as “slow pay.” Because balances owed make up nearly another third of your score, this causes damage, too. Paying less than the contractually agreed-upon amount will cause a lender to quickly run away from your loan application.

3. Use Revolving Credit for Every Purchase

Cash takes up too much room in your wallet, and creating a budget is too complicated. Instead, use your credit cards to charge groceries, fuel, contractor software, utilities and clothing. Yes, using credit is easy. But use it too much and you only ensure your outstanding debt will rise as fast as your credit score falls.

4. Open Numerous Credit Accounts

Submit every credit application you receive in the mail and open a credit account at every store in the mall. With your plastic card collection, you can shop at all your favorite retailers and access a variety of credit limits and cash back options.

Sounds great, right? But have too much credit and you risk damaging your financial future.

5. Max your Credit Accounts

Even if your high balances are the result of bad luck instead of profligate spending, lenders won’t know the difference. Lenders see you as a risk, and your credit score reflects those high unpaid balances.

6. Close your Long-term Credit Accounts

Think it’s a great idea to close out those long-held but little-used credit accounts? Think again, because accounts from years ago actually show your financial responsibility. Lenders prefer long-term relationships to credit-sinking ships that pass in the night.

7. Ignore your Credit Report

Why order your credit report? Lenders never make mistakes, right?

The consequences of ignoring your credit report, available free once per year from AnnualCreditReport.com, can be significant. Dispute incorrect balances and late payments immediately, and report suspected identity theft to the police and the three credit bureaus, Experian, Equifax and TransUnion, immediately.

8. Ignore Collection Agency Requests

If you’re getting notices from a collection agency, then chances are your credit is already damaged. But you may be able to salvage it if you work out a repayment arrangement.

Do not ignore collection agency requests. Doing so could result in wage garnishment, asset freezes or worse.

9. Co-sign as Often as Possible

This one is tricky, because it’s difficult to say “no” to a friend or family member in need. But resist the urge to co-sign. Remember, your signature gives your friends unlimited access to your good credit, and you don’t need to do a thing to destroy it. All it takes is one or two missed payments and suddenly you’ve got a credit disaster on your hands.

These nine simple steps help you destroy your credit rating. If you’re having financial problems, talk to your creditors or make an appointment with a not-for-profit consumer debt counseling agency like the National Foundation for Credit Counseling. It might take some time, but even the worst credit cases can improve over time with discipline and commitment.

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