Certainly, all Americans are not born with deep pockets. Half of the US population still survives using credit cards, loans and other methods for borrowing money. Keeping high debt is viewed as a liability and it can have a negative impact on your credit score. But, it won’t hold true completely as the age of your average account on your credit profile can actually help in increasing your score. Length of credit history is one of the five factors that make up your credit report and it has a 15% impact on your credit score.

Length of history can aid in building your credit if you pay on time. Poor credit due to unpaid accounts and high debt can be a difficult task to take on without the help of an experienced credit repair service.

Would you like to know how help is possible? Take a look at how long-term debt can help your credit score:

Credit length

Long-term loans generally have a term of multiple years and it has a 15% impact on your credit score. This is a factor that most consumers don’t pay attention to, but it’s very important. Well, 7 years or more is considered the ideal credit length but In this tenure, the activities listed on the credit report are monitored and if it’s found fault-free, then lenders never hesitate to lend money.

Long-term active loan accounts that are in good standing make you a favorable candidate for lenders to lend money to and it does a great deal to help your score.

Payment history

How timely you are paying your bills or installment loans is an important factor that affects your credit score. The credit bureau scoring model heavily favors consumers whose payment history don’t include overdue bills such as charge-offs, collection accounts,bankruptcy, tax liens and student loans.

When manage your debt responsibly by maintaining low balances and paying on time, you will more than likely get approved for loans and you’ll maintain a great score.


Because most people don’t have ample savings and need long-term debt to make large purchases on things like a home, car or even business loan it can diminish savings and cause financial strain.

Whether you apply for a loan to buy a home , car , or boat you’ll have to repay the loan along with interest for the agreed loan term . The interest you will pay is based on your credit score because people with a good or excellent credit score will pay a lower interest rate as opposed to those with a a bad credit score.

It implies that borrowing and credit health and are intertwined. You can save much more money when your credit health is good.

Tax benefit

In the USA, any class of person can take advantage of tax exemptions, tax credit or tax deductions that are referred to as tax breaks. It actually works as a saving on taxpayers’ liability and a great benefit for long term debt.

For instance, Mr. Paul has taken a home loan and car loan whose interest paid off by him is written on April 20th , then the amount he paid as interest will get deducted from the total tax he has to pay. With tax breaks, Mr. Paul can save and plan future investments.

Gain potential

The long-term debts are initially difficult to handle, but after some time they will get paid off. What If you need to take out student loans in order to further your education so you can pursue your career then taking student loans would be considered to be good debt. Because when you land a great job, with great income the debt that you take on is worth it. Your earning potential will increase and you’ll have the ability to pay your obligations and debt on time, which will help improve and maintain a favorable credit history.

Summing it up

Knowledge is powerful, but only when you apply it. You can turn the table on any situation if you stay persistent. The same is true for debt, which is considered as a big burden, but if carefully managed, then it becomes a tool to improve the credit score and rating. Think differently and leverage the long-term debt to your advantage.