5 surprising things that can impact your credit

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Hopefully you already know the five factors that can impact your credit — payment history, mix of accounts, amount of debt, history of credit inquiries and the age of your accounts. But did you know some of your other behaviors can have far-reaching consequences as well? It's true — even your cable bill can come back to haunt you. Here's a look at five of the lesser-known factors that can affect your credit.

1. Parking Tickets

Parking tickets are one of those things that can easily slip through the cracks. But let those tickets slide for too long, and your credit could get dinged. The ticket could be reduced to judgment, John Heath, a credit expert with Credit.com affiliate Lexington Law, said via email. "The judgment is a public record that can be picked up as a derogatory mark on your credit report."

2. Credit Report Errors

"Consumers, on average, across all the [credit] agencies have some sort of error on their credit file," Michael Bruemmer, vice president of consumer protection at Experian, said. Typically, they don't have a clue about it because they haven't checked their credit in awhile. (You can pull your credit reports for free each year at AnnualCreditReport.com and view two of your credit scores for free, updated monthly, on Credit.com.) Not sure how to go about disputing any errors you've found? This handy guide can help you get started.

3. Applying for Too Much Credit

There's nothing wrong with shopping around for good credit offers (and some credit scoring models are built to allow for a certain amount of comparison-shopping for a particular type of loan). But apply for too much credit at once and your score could take a nosedive, Bruemmer warned. Some people think adding a new card will increase their credit utilization, or level of debt compared to their credit cards' available credit limit. But, while this is correct in theory, applying for too much credit at once can create several hard inquiries — each application for a can trigger a credit pull — which can make you look risky in lenders' eyes.

4. Public School Fees

Failing to pay public school fees for things such as labs, library books, athletics and so on can result in a referral to a collection company, Heath said, so don't forget to take care of them. If you don't, and they end up in collections, it can reflect poorly on your credit history and stick with you for years, even after you've repaid the debt.

5. Utility Bills

As with parking tickets, not paying your utility bills can also do a number on your credit, Heath said. "These past-due bills can result in a referral to a collection company, which in turn can result in a derogatory mark on your credit report."

Now see 10 purchases you shouldn't make with a credit card:

10 purchases you shouldn't make with a credit card
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10 purchases you shouldn't make with a credit card

#1: Household bills

If you are already cutting it close for the month, you may be tempted to use plastic to pay the utility, cellphone or cable bill. But if you’re not paying off your full balance each month, the interest you will be charged makes those monthly bills even more expensive.

Photo credit: Getty

#2: Cars 

Car dealers often don’t allow credit card purchases, or may limit the amount of the purchase price you can put on your card. Dealers don’t like credit card payments because they have to pay the 1 to 3 percent fee the card company charges to process the transaction.

You could exercise the cash-advance option. But you’ll pay a fee and a higher interest rate. Also, you won’t get a grace period on the interest — it will begin to accumulate right away.

Instead of using a card, go to a credit union or bank to get financing approved at a reasonable interest rate before shopping for a car.

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#3: Student loans

If you can’t afford to pay your federal student loans, you have options. They include an income-based repayment plan, deferment, forbearance and possibly loan forgiveness. Take a look at “How to Get Free Help With Your Student Loans” to learn more.

Paying your student loan debt with a credit card increases the amount of interest you’re paying on the debt. Even if you have a zero-percent introductory credit card offer, it will expire in time.

And while the federal government will accept a credit card payment for loans in default, many student loan servicers won’t allow this form of payment.

Photo credit: Getty

#4: Retail therapy

Think a new purchase will cheer you up? Perhaps. But remember that cash is king if you choose this mode of “therapy.” Use cash, and you won’t let your credit card balance spiral out of control.

Photo credit: Getty

#5: Medical bills

If you use a medical credit card available through your health care provider’s office to pay bills, be careful to read the fine print about your obligations.

Also consider steps you can take to reduce health care costs. See “10 Ways to Fight High Medical Bills.”

Photo credit: Getty

#6: A night on the town

Handing your credit card to an unscrupulous waitperson equipped with a skimming device isn’t your only worry. If you’re out on the town throwing back drinks, it’s easy to run up a tab you can’t afford.

So when painting the town, it’s best to pay with cash.

Photo credit: Getty

#7: Big-ticket items you can’t pay off immediately

Credit cards offer great purchase protections and should be used for many big-ticket purchases. But buying something on credit when you can’t afford to pay it off right away isn’t smart.

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#8: Credit card payments

You can’t charge your monthly credit card payment on another credit card. But perhaps you’ve been tempted to use a cash advance from a credit card to bolster your checking account so that you can pay other bills.

We’ve already explained the folly of cash advances. Your credit card is not an ATM and should not be used as one.

There are real benefits, however, to transferring high-interest credit card debt to a new card with a generous zero-percent balance transfer offer. Just be aware of the balance-transfer fee and find out how long the offer lasts.

Photo credit: Getty

#9: ‘Sale’ items

Convinced that you might miss out on savings if you don’t purchase a specific item on sale right away? That’s one of the warning signs of an impulse buy.

Wait a day and think about whether you really need the item. Nine times out of 10, the answer will be “no.”

You aren’t saving money by spending it for something you don’t need.

Photo credit: Getty

#10: Unsecured online purchases

When shopping online, make sure the web address has “https” at the beginning. If it doesn’t, that’s your cue to take your online shopping elsewhere.

In fact, do your homework before purchasing anything online to make sure a company is reputable and not the source of many consumer complaints.

Which purchases do you refrain from making with your credit card? Let us know in the comments below or on our Facebook page.

Photo credit: Getty


This article originally appeared on Credit.com.

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