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Raising my credit score
I recently got a home equity loan and new credit card with 0% interest. I had two credit cards that I transferred the balances to my new credit card. I didn't close the accounts so I have 3 credit cards with 0 balance and my new card with about a $7,000 balance. The home equity was for $25,000. My credit score went from excellent to good. I always pay my bills on time and have always had an excellent score. It only need about 8 points to do that. Does anyone know how I can do that? I would appreciate any advise. Thanks for reading this....

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Zero Balance can result in lower scores

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You've done a good job to consooidate debt, but the $0 balance cards may be hurting your score.  Accounts with no activity, especially credit cards, will be counted as inactive.  No I don't suggest you actually carry a balance to improve your score, but if you do need to show activity.  Put a few charges on the cards each month and pay it off fully each month when the bill comes.  The sweet spot seems to have about 5% card utilizaiton.

The function here is to show that you can use credit responsibly, the scoring model is all based off of what types of factors are observed for people who default on their obligations vs. those who always pay up.  Those statistics drive what behaviors result in score increases and which ones drop your score. It is all a guessing game, but some of it is very logical.

If you assigned credit scores, which of these things would you give points for or take them away for?

- Revolving credit utilization at 95%

- Debt to Income ratio of 75%

- Average credit line age of 11 years

- Missed or late payments in the last 10 years: 0

- Credit inquiries in the last 2 years: 22

Those all seem logical, but what about:

- Revolving credit utilization at 0%

- Number of accounts on history 10

These factors hurt your score, which may seem counter intuitive.

So, my suggestion, go charge up those cards a little bit.

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The Whole System is a Scam

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I only have one credit card. I had it maxed out at $4100. In the past 6 months I have paid off $2750. My balance is now $1250. I have received only 2 points increase in 6 months/ I have an "A" in every category. But my overall rating is Fair. Trying to figure out this system is impossible because it was meant for most us to never get a good score. If we did the banks would have to loan us money for cars and houses or credit cards at reasonable rates.. Rigging the system keeps us down. If you want to live better they want a pound of your flesh.


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