Negative Information & Personal Credit

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Created on 12/20/2016 by Thomas (TJ) Underwood

Learn How Negative Information Affects Your Payment History & Personal Credit...


Did you know that “Negative Information” on your “payment history” in your credit file can not only hinder your goals in a real way they comprise the number 1 factor (at 35%) when looking at the 5 factors that affect your credit and credit score. 

In a previous discussion I spoke of how I would discuss the 5 factors that are involved in managing your credit score. 


In this discussion we will look at your “Payment History” and explain in a meaningful way why you must do your best to always pay on time and always keep “Negative Information” off of your credit file.


You must have the daily mindset that you will be disciplined and never compromise when it comes to managing your “Payment History” as your goal is to keep “Negative Information” off of your report in the most effective manner as possible.


What pushes you into bad decisions in the management of your finances?  

What pushes you into good decisions in the management of your finances?   

In a nutshell—with most it is the careless management of their finances for those who make bad decisions.   

With those who make good decisions in the management of their finances you will usually find that they have a “responsible attitude” when it comes to managing their finances.


As someone who has seen those of all ages and demographics manage their finances in the best of ways and the worst of ways—it is vitally important that all who manage their credit and finances have an effective system that allows them to move forward and reach their credit and financial goals.


I have seen "20 plus year old young adults" mismanage their finances in ways that are astounding with no positive credit on their credit file and 6 or more accounts in negative standing.  

In most cases creditor's took advantage of them due to them being naive about credit or having an inappropriate understanding of their finances!

In most cases they had no desire or yearning to learn how to manage their credit in the right manner or a more effective manner. 

Many did not even have the “concept of how credit works” and how it affected their life—as a part of their mental framework.


On the flip side I have also seen 20 plus year old young adults manage their credit and finances at an optimal level and it all started with them being educated to some degree and having a yearning within to manage their credit in as effective and responsible a manner as possible.


I have also seen 70 plus year old men and women mismanage their finances in ways that were astounding with little or no positive credit on their credit file and many accounts in negative standing.  

In most cases they too had no desire or yearning to learn how to manage their credit in the right manner or a more effective manner.  

Many had accumulated bad habits over a number of years and never got around to looking at more effective ways of managing their finances.


Many did not even have the concept of how credit worked and how it affected their life on their radar!


On the flip side I have also seen 70 plus year old men and women manage their credit and finances at an optimal level with credit scores above 740 and it all started with them being educated to some degree on how credit works—and having a “yearning within” to manage their credit in as effective a manner as possible.


In between those two age brackets I have seen successful and unsuccessful management of credit from those from all walks of life. 

It is imperative that you understand how credit works regardless of your age and you must have a system within your mind that allows you to navigate the “credit maize” in a more effective manner on a daily basis.


It is important that you realize that Negative Information (Payment History) accounts for the largest percentage (35%) of your credit score and it is important that you have a real understanding and effective system that allows you to pay off those whom you owe in a timely manner—consistently!


You cannot allow “negative information” to creep into your credit file and you must put yourself in position to avoid that scenario by gaining the knowledge that is needed at this time so that you can proactively manage your credit affairs and keep a positive “payment history.”


You must properly establish an emergency fund to put yourself in position where you significantly reduce the odds of allowing negative information to come in on your credit report or credit file. 

You must create a workable and understandable budget (personal cash flow statement) that will take you toward your goals and help you manage your credit and finances more effectively.



Those of you who now have accounts in collection (negative information) and are considering settling for a fraction of the amount must realize that if you pay off creditors on collection accounts for a fraction of the amount owed, be sure to get them to send you “written documentation” that the account is "paid and settled in full” as opposed to not getting that documentation!

By doing so you can improve your credit in a more efficient manner!


Negative Information will have a very negative connotation on your credit report as you might imagine.


If you fail to pay or fail to pay on time and "your creditor reports that failure" to the 3 major credit bureaus that will pull your credit score downward and make your credit file less appealing to future creditors—as well as your current creditors. 

Many of your current creditors will close or reduce your available credit if they see "negative information" in your file or a pattern of late payments.


You must do all that you can to pay your debt in a timely manner and keep all of your accounts on file with the credit bureau as well as those that are not on file in good standing.


Whether your credit card, house payment, car payment, real estate taxes, water bill, medical bill or any other agreement that you engage in where you owe others—you must pay in the agreed upon manner as best you can if you desire to optimize your credit report and credit score!


Remember the 5 credit factors include:


Negative Information (you must do all that you can to keep it off of your credit report—you tell me all about "Payment History and the importance of keeping Negative Info out of your credit file" after reading this article—LOL—no seriously)  also known as your Payment History— comprises 35% or is

1st in importance of the credit factors


Utilization or how you Use Your Credit (do your best to keep your account balances low or at zero)—30% or

2nd in importance of the credit factors


Time Factor or how long you Keep Your Accounts Open (be sure to keep older accounts with a positive payment history open)—15% or

3rd in importance of the credit factors


Type of Credit or your Credit Mix—which we discussed in a previous article (you tell me all about "the types of credit"—LOL—no seriously)—10% or

4th in importance of the credit factors


Inquiries or how many creditors do a Hard Pull of your credit file (keep your hard inquiries to a minimum if you are trying to improve your credit in a timely manner)—also 10% or

The same level of importance as the type of credit mentioned above


100%get the picture…


When it comes to your personal credit reports and personal credit scores, Negative Information—also commonly referred to as your Payment History—is first in importance and carries the most weight as far as the 5 credit factors are concerned.


In the time period that we now live in it is imperative that you pay your debt on time and you have a thorough understanding of all of the factors that affect your credit.

You cannot allow late payments (30, 60 or 90 days), charge offs, debt settlements, bankruptcies, foreclosures, collection accounts, lawsuits, wage attachments, garnishments, liens, judgments or anything else in your payment history to appear on your credit report if you desire tomaintain, improve and utilize your credit effectivelynow and in your future!

Your decision to effectively manage your credit on a daily basis is critical for your short, intermediate and long-term goals and if you desire to achieve more and do more throughout your lifetimeit is imperative that you at least have a basic and workable understanding of how credit works.


It is our desire that this page has at least sparked your desire to get started on a path to managing your credit in a more optimal manner if you are not doing so at this time.

If you are managing your credit at an optimal level continue to do so and utilize this discussion as an opportunity to re-focus and use credit wisely throughout your lifetime.

Keeping "negative information" out of your credit file is not only a good starting point for maintaining and improving your credit, but also carries the most weight (35%) when it comes to managing your credit in a manner that allows you to enjoy life more abundantly while here on earth.

In closing, you must force yourself to think about your credit and the credit factors—even if you don't like to!

By doing so you can continue on your upward path to making your dreams come true!


All the best…

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About This Article:


The above article was written by Thomas (TJ) UnderwoodThomas (TJ) Underwood is a former fee-only financial planner, a former top producing loan processor and is currently a licensed real estate broker in the state of Georgia. 

He is the writer behind The Real Estate & Finance 360 Degrees Series of Books that include The Wealth Increaser, Home Buyer 411 The Smart Guide to Buying Your Home, Home Seller 411 The Smart Guide to Selling Your Home, and  Managing & Improving Your Credit & Finances for this MILLENNIUM.

In addition he is also the writer who created The 3 Step Structured Approach to Managing Your Finances, and CREDIT & FINANCE IMPROVEMENT MADE EASY—NEW GUIDE that you can download right now "(at MIMIMAL cost $3.95)" to learn more about his writing style and how you can achieve "more" success in the current economy.

He is the creator of where he regularly blogs about helping consumers improve their credit, finance and real estate pursuits in an intelligent, consistent and proactive manner. 

He’s always looking for ways to make intelligent finance improvement happen for those who “sincerely desire” success in their future. He was the first financial planner to coin the phrase "financially alert mind"  and he consistently writes in a style that is designed to provide consumers the ability to take control of their lives and achieve great results.

You can contact him from a number of sources but the most direct way is to contact him through the contact us block that can be found at the bottom of this page.  You can also get highly relevant tips on "living your life more abundantly" and link to and possibly earn revenue by logging on to

He is also an IRS registered tax planning professional with over 30 years of tax experience and can be reached at:



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