Payment history can have the largest impact on your credit scores. Making on time payments is the most important aspect of your score. Credit is King!

Your credit works on a what have you done for me lately basis. The most recent late payment counts against you the most. A late payment in the last month might cost you up to 100 points on an installment loan and 50 points on a revolving loan. As time goes by the amount goes down. So think about your last 6 months credit history then 12 then 24. After 2 years late payments don’t matter that much anymore as far as your score goes. So even the worst credit score can be greatly improved with in 12 to 24 months.

A late payment happens when your payment is made 30 days after the due date. so if your car payment is due April 15 and your payment doesn’t get maid until after May 15th that will be reported as a 30 day late. As long as your payment is made before the 30 day mark it will not be reported late.

Paying the bills on time can be the first thing to establishing a good credit history so set aside some time around the end of every month to make all you payments. My bank sends out payments in a couple days so I usually do mine on the 25 of every month.