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Have a credit card with no limit no balance for 7 months, plus 6 credit cards with limits over 10000 no balance for 5 months. 8 resolving debts including student loans close to $60000.Last time [Oct] I checked my FICO score was 748 but hoping to increase this. What are my chances and how do I achieve this? Pay on time at least $5.0 over minimum.
npumcrisz
Your credit score is great anything over 720 to 740 is as they say "bragging rights" but won't affect any loans or rates.
I would focus on any extra funds going to pay the student loans down. Paying more will not increase your score per say because payment amount is not part of the score equation. Paying more to lower the balance will help.
Karla is right--I think sometimes people focus on the goal being the credit score and not what the credit score is going to do for you--namely, help you secure a mortgage or other loan at the best rate. For many lenders, any score about 720 is considered excellent credit.
Well, I got an e-mail today from Score Watch. My FICO went up 30 points yesterday~~ YEA!!!!! No explanation, just that it went up. I guess one or more of the credit cards that I paid off reported, raising my score. More to come I hope!
In another post you said the high balances you had was the only thing affecting your score. If there are no past dues or negative "issues" you will probably see a nice increase.
Which report did you get? I have actually found trans Union to most times have the lowest score.
I would wait at least 45 days to make sure the creditors have all reported the pay offs, then go into the lending institute you have a relationship with and tell them you want to buy a house in June.
They can pull all 3 reports and review your credit with you. You will also be able to make sure that it is showing everything paid off.
What kind of credit limits are you showing on the cards? You can DM me if you don't want to post the info. The reason I ask, is if you are sitting with 4 or 5 cards with very high limits ($15k+) and many small limit accounts. You might want to revisit closing some.
Just to let you know these suggestions and advise is from 30 years in the credit industry.
IMHO, the whole credit system is a joke....because the score models and the so-called geniuses who created the FICO system designed the system against the consumer in most ways. From what I have read in the past months the scoring system purposely looks for bad things in your credit report so that your score can stay low. Why you think that missed payments, collections and such make your score drop like a rock off the cliff while trying to improve the score takes months to see any notable improvement?
As for TransUnion, i think they are the worst of the 3 bureaus because each time I have pulled my own credit my lowest score was ALWAYS from them. Not my favorite bureau by a long shot.
And credit cards are your worst enemy too when it comes to keeping the score decent because go over 30% of the limit and the score takes a hit....it doesn't take much for the score to go down. That's why I feel that the entire FICO (and whatever other) scoring system, along with the people that designed it are a joke because its often rigged against the consumer. If the scoring software system was made to look for more of the positives on our reports as much as the negatives, the system would be a bit more fair, which is why the algorithm is kept secret.
I just feel if that part of the credit system was more fair as terms of scoring, then it wouldn't be such a struggle in trying to improve the scores, and some people I know have given up on trying to improve their credit score and went the cash route, because it simply takes too long to improve it. And it sucks that so many things are reliant on credit these days.
IMHO, the whole credit system is a joke....because the score models and the so-called geniuses who created the FICO system designed the system against the consumer in most ways. From what I have read in the past months the scoring system purposely looks for bad things in your credit report so that your score can stay low. Why you think that missed payments, collections and such make your score drop like a rock off the cliff while trying to improve the score takes months to see any notable improvement?
This is because, when a person is flaky with paying a bill, the person is at greater risk of default. It takes time to develop credibility and only one once instance to lose it. If someone has been paying on time for 10 years and now have a problem paying the bill, was this just a blip? Or is this a bad sign of things to come? Fair Isaacs has a statistical model that quantifies this risk.
Quote:
Originally Posted by AVTechMan
I just feel if that part of the credit system was more fair as terms of scoring, then it wouldn't be such a struggle in trying to improve the scores, and some people I know have given up on trying to improve their credit score and went the cash route, because it simply takes too long to improve it. And it sucks that so many things are reliant on credit these days.
Exactly how is it rigged against the consumer? Consumers that use credit responsibly and pay debts on time have higher credit scores. Consumers that use credit irresponsibly and make late payments or miss payments altogether, or completely ignore debt obligations have worse credit scores.
This is because, when a person is flaky with paying a bill, the person is at greater risk of default. It takes time to develop credibility and only one once instance to lose it. If someone has been paying on time for 10 years and now have a problem paying the bill, was this just a blip? Or is this a bad sign of things to come? Fair Isaacs has a statistical model that quantifies this risk.
Exactly how is it rigged against the consumer? Consumers that use credit responsibly and pay debts on time have higher credit scores. Consumers that use credit irresponsibly and make late payments or miss payments altogether, or completely ignore debt obligations have worse credit scores.
For consumers that use credit wisely like they should, yes they do get the benefit of higher scores, no doubt on that end. And those who purposely misuse it also deserves to be penalized, hence bad credit. But there are many circumstances to where even good credit users come into difficult situations and such or have cases where they were victims of ID theft and had their credit ruined.
My only point was if the scoring model was more fair in analyzing the positive as well as the negatives in a given credit report, then the scores would be more fair and perhaps easier to improve. I can't remember where I read it from, but I read that the algorithm in the model looks for more of the negative stuff than the positives. Many people who invent scoring models like this will never tell you how the system is really designed to work unless you were one of the people that helped create it.
Like recently, FICO announced that being an authorized user on another's credit card will no longer have an effect on the score. So for those of us back in the day that piggyed back on our parent's credit to start off with establishing a good history, no longer have that.
And yes I already know having good credit takes time to build up...any kind of credibility takes a bit of time.
For consumers that use credit wisely like they should, yes they do get the benefit of higher scores, no doubt on that end. And those who purposely misuse it also deserves to be penalized, hence bad credit. But there are many circumstances to where even good credit users come into difficult situations and such or have cases where they were victims of ID theft and had their credit ruined.
I don't believe it's a matter of "deserving" or "not deserving" good credit scores. From a creditors perspective, it doesn't matter if a person purposely or mistakenly fails to make contracted payment on time, all that really matters is, what are the chances that the person will not pay (on time or at all) in the future. A person could just decide he wants to buy more stuff and doesn't want to pay his bills. Or he could lose his job, get in an accident, and not be able to pay his bills. Either way, the creditor doesn't get paid.
There were several accounts opened in my name/credit that were sent to collections without ever once notifying me. I only noticed it on my credit report several years later, when I contemplated financing a home purchase. I had the misfortune to deal with an unscrupulous, totally dishonest collection agency -- I spent quite a bit of time, energy and money and filed papers for litigation for them to remove those tradelines from my credit report. Although the actual dollar amount was not significant (a matter of a couple hundred bucks), initially, I didn't have that kind of money to throw away, and later on it became a matter of principle.
I am glad we have the consumer protections (FDCRA, FCRA) to help combat the ill effects of ID theft. They don't do enough, IMHO, but they are a start.
Consumers that use credit responsibly and pay debts on time have higher credit scores. Consumers that use credit irresponsibly and make late payments or miss payments altogether, or completely ignore debt obligations have worse credit scores.
Jinxor, I don't know I have a low credit score and it isn't because I've completely ignored debt obligations. I've been working hard for the past 7 years on my credit. When I purchased my home, my score was a 640, the highest it's ever been. . I have paid off 3 cars since 1990 - never having been late. I had two credit cards in 1989 for which I am guilty of never having paid (both credit lines totaled less than $500). Spent years trying to get these off my report - finally had success which is why I suppose my score went to a 680.
However, after purchasing my home, my score went to a 589. I pay my mortgages on time, I have one car loan which has always and still is paid on time. I got a secured credit card just to show some "revolving credit" ($300 limit) and I charged it up to $150 and pay the minimum amount due on time. When it's paid off, I charge it again and do the same thing. Pulled my score the other day after 1 1/2 years of paying on time and what do I see, 591, "reaged debt" by 2 credit card companies. No sign of my BOA secured card, no sign of my paid off car loans, 1 mortgage (paying on time), 1 installment loan (paying on time).
If this isn't bogus, I don't know what is. It all appears to be one big scam with the credit bureaus and the collection agencies.
I don't know what to do now, I'm tired!
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Not my favorite bureau by a long shot.
. I have paid off 3 cars since 1990 - never having been late. I had two credit cards in 1989 for which I am guilty of never having paid (both credit lines totaled less than $500). Spent years trying to get these off my report - finally had success which is why I suppose my score went to a 680.
