Credit scores
8 years ago
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Credit Scores and Open Credit Cards
Comments (3)DH & I also have several cards with no balance on them. We will be applying for a mortgage soon, so I asked my banker this question. He told me to cancel the majority of the cards, but to keep either a couple with fairly low limits or one card with a pretty decent limit. He said that banks like to see someone have $30,000-$40,000 worth open credit on cards (depending on your income). He says that lets them know that you have a source of available money that you can access quickly. He said they don't like to see huge amounts of open credit because that shows the potential for a problem. We pulled our own credit reports & they said that the amount of unused credit we have may actually be hurting our score. We have only a tiny fraction owed but a lot of open credit. Another thing my banker & the credit report mentioned was the ratio of how much you owe to the amount of open credit. Example: If you owe $5,000 & have two cards with a total credit limit of $20,000, cancelling one card that has a $10,000 limit can actually hurt you. Instead of having a balance that equals one quarter of your available credit, you will now owe an amt. equal to half of your available credit. If you want to cancel, make sure you write a letter to the credit card company & keep it & proof that you mailed it on file. Make sure to request that they note in your file that the card was cancelled at your request. Having a lender cancel your card can hurt your credit score. If you won't be applying for a loan any time soon, you can just leave them & they will drop off of your credit report after a few years....See Moreraising credit score?
Comments (1)Suggest you take a look at your credit report (not score). It's free once a year at Annual Credit Report dot com. Then challenge anything that's not right. The main thing (I understand) is to keep use of credit low , make payments on time, and always pay at least the minimum. If you have any old credit accounts (maybe store credit cards) keep them open. There's no one you can "call" about this. Any protests about your credit info should be made in writing. The mailing addresses of the 3 credit bureaus are readily available. It takes some time for a credit score to change. Don't keep checking. Wait a few months before you check it again. Good luck....See Morecredit score/auto insurance
Comments (6)I got hit by the credit score problem last May on my car insurance. It did not matter that I had a high credit score my score had dropped because on the one credit card that I have I had more charged than the 7% of the credit amount which in this case was more than $1200. Waiting to see what the rate has been increased this time. Rate increased 5% but person at Credit reporting agency did not understand why I was upset since I still had a good score. Scores do not always mean anything....See MoreAnyone Have a Good Lender for Lower Credit Scores?
Comments (9)FHA required 620. They are a young couple, had a run of financial trouble (husband's employer went out of business). The couple tightened their belts until husband found a new job; they bought groceries & paid their rent & paid their utilities & insurance, but they were 30 days late on a $30 *credit card bill* for 2 months*, & there's no way these days for an underwriter to make adjustments. In the past, you could document something like that & the underwriter could adjust for it. Today, if you have a lower credit score, you have to re-build for the next 6 months or so....See More- 8 years ago
- 8 years ago
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