Give me some credit
DING!
Time for your annual FREE credit report from all three Credit Reporting Agencies. Ever since June of this year, one free credit report from each Agency must be provided to Louisiana residents upon request each year.
To get yours (and I highly recommend you so so, if for no other reason than to check for errors and bogus accounts in your name) go to the following site:
http://www.annualcreditreport.com
Now, that won’t get you your Credit SCORE, which many institutions use to decide whether to give you new credit/loans. You still have to buy that. I was curious, so I bought mine for six bucks and was pleased, I suppose, with the result.
Anyone have any comments on how to best “work the system” to bolster Credit Score, outside of the obvious suggestions to keep debt low, buy on credit often, and always pay on time, paying more than the minimum?
July 6th, 2005 at 5:03 pm
I don’t think that paying more than the minimum balance much affects the score. I think that’s just a way to reduce the amount of interest you pay.
I’ve been told that it’s better to keep some balance on your cards. (The people who use the card and then pay it off every month apparently don’t get any bonus points).
But, really, there’s no magick way to play the system.
July 7th, 2005 at 6:40 am
Take out a loan for something, like a car. Make sure you have the money to pay off the loan immediately, but do not do so: keep paying the loan on time, with minimum or slightly above payments, as if you actually owed the money and are paying it back.
July 7th, 2005 at 9:00 am
It would be nice to pay more than the min. but, if it all you have, they shouldn’t have to raise you intrest rate by half.. As you can see i hate my ccc. They are evil money whores!!!!
July 7th, 2005 at 11:45 am
I’m not sure what paying more does, but paying onetime what you owe is nice. Also, don’t have too many credit requests; i.e.: don’t apply for 10,000 credit cards. Inquiries hurt your score.
July 7th, 2005 at 4:09 pm
Paying more gets you out of debt, earlier, thereby reducing the Interest you are “trading” for good credit, but still allowing the debt to be paid in a slow enough time to establish long-term credit.
September 24th, 2005 at 11:20 pm
First off, you don’t have to be rich or have a lot of money, or even be anywhere near debt free to successfully build decent or even good credit no matter what your situation may be, as long as you understand that it’s going to take some time (2-5 years usually) and you’re willing to commit to making the best of it no matter how long it takes.
I seem to recall seeing “pays more than the minimum” at one point somewhere on one of my reports, which I ALWAYS do even if it’s only a few bucks. For some strange reason, card companies seem to reward you for the payment being just a few extra bucks and at least a day early based on the due date, which means your credit score will grow because of it as well. Even if you start off with mediocre or even horrible credit, by doing that you’ll eventually get more credit offers with better terms and your score will slowly rise as long as you keep your balances vs available credit ratio at like 32% or less, carry at least a small balance each month, and always pay even $5-$10 more than the minimum at least one day before the due date each month. Even if your ratio isn’t so good it’s not such a bad thing, you just need to work on improving the ratio. Sometimes adding more credit withno intention of using it can even help as it will most definitely improve the ratio. You just have to watch the whole debt vs credit vs income closely to get a feel for how much total credit is too much.
I went from having such a horrible score I was completely unable to get any unsecured credit card back in late summer 2001 to a score of 680+ by spring of 2004 to land a low interest long term used car loan, followed by a 720+ score less than a year later that landed me a 6.25% fixed mortgage in spring of 2005. That doesn’t mean my debt went away, or even down very much… it just means I’m getting better at playing their silly little game to try and get what I want using their credit when I think I can manage to afford it based on their terms.
Another little tidbit they often don’t tell you either…
Open a “savings account” in addition to having a checking account that’s carefully kept in good order as well. Even if it’s only got $5 in it and you never make any more deposits, it doesn’t really matter so much how much is there, as long as you have the account. For some reason that supposedly says you’re stable and looking to build your future, whether you really are or not. NEVER bounce a check. If you know it won’t clear, or you’re not really sure, DON’T write it, ever! Paying one credit card bill with another card isn’t a wise thing to delve into but it can be done for a month or two to avoid hefty late fees only if absolutely necessary, as long as both cards aren’t from the same company. DO NOT do that more than twice or you’ll be in far worse financial trouble faster than you can blink.
I hope these tidbits prove helpful.
Thomas