Your credit score is a key to unlock various financial opportunities. Therefore, one must never take their credit scores lightly. If you thought that only loan defaults can hurt your credit score, think again. The plastic card that has become an indispensable part of your life is one of the major causes of dent in your credit score. Don’t believe? Take a look at five ways a credit card can bring down your credit score.
1. Applying for credit cards frequently
Lending money is a risky business, therefore before approving a credit card or loan application, creditors enquire about the applicant’s credit report from bureaus to assess their creditworthiness. Such an enquiry is called hard enquiry, which hurts your credit score. Therefore, apply for credit card only when you need it. In addition to this, lenders avoid credit profiles with multiple credit card accounts as according to them it is a sign of desperation. Instead of applying for multiple credit cards at different banks, use the one that you can handle efficiently and fits your requirements the best.