Your credit rating can dictate every part of your future plans, from buying a house to paying for your next holiday. Here are the top things you may not realise affect your credit rating.

1. Having a high credit card limit

When applying for a loan, the lender looks at your credit card limit, not the amount you owe on your card. Even if you only use $1000 of a $50,000 limit, the lender will still treat you as though you regularly borrow $50,000. A smaller limit will help keep your credit rating higher.

2. Spending more than 50% of your credit limit

Your credit score is calculated against your debts using a debt-to-credit ratio or debt utilisation ratio. Rather than looking at how often you pay off your debts, credit raters also look at the amount of available credit you are currently using. If you’re using more than 10-30% of your available credit limit, your credit rating will likely be impacted.

3. Missing any repayments greater than just $150

Any overdue payment larger than $150, paid later than 60 days counts overdue, which is listed on your credit score for five years. Even small amounts matter. The Office of the Australian Information Commissioner (OAIC)’s report on your credit doesn’t reveal the amount on your missed payment; only that you missed the payment.

4. Transferring the balance of one credit card to another

This is an obvious one; but if you’re trying to escape fees on your credit card by moving the balance to a different bank, your rating will become lower.

5. Just applying for a credit card

Every time you apply for a line of credit including a credit card, your credit rating is impacted. Even if you don’t even go ahead with the credit card and you never even use it, just applying affects your rating.

5. Applying for multiple loans while waiting for one to be approved

‘Don’t put all your eggs in one basket,’ doesn’t apply when it comes to loans. Every time you apply for a loan, even if you don’t go ahead with it, your credit rating is reduced.

6. Being involved in insolvency, bankruptcy and court judgements

If you’ve been involved in any financial court judgements, as well as insolvency or bankruptcy, your credit score will be reduced.

7. Having a partner or spouse default on a loan

If you and your partner have joint bank accounts or a mortgage in both your names, you’ll want to ensure you submit your repayments correctly and on time. Even if your partner isn’t listed on the loan, their repayment history will influence your credit score.

8. Not letting your banks and other lenders know when you change your name

If you have a pristine credit history and change your name without letting lenders know, your credit history will be lost. A perfect credit history is one of the best ways to ensure an ongoing high credit rating.

9. Closing credit cards with a good repayment history

Use it or lose it to keep a good credit rating.

10. Missing just one payment out of many each month

The OAIC shows if you’ve missed just one payment in your monthly stack of bills, your credit history will still show you’ve not met your obligations for the entire month.

Don’t let small mistakes lower your credit rating. Stay on top of your obligations so when you need a loan, you can get it.