I have a credit score question
YourDirtisMyfood
Posts: 4,641
I had a credit card from years ago that had a high bill on it, resulting in my credit score not being the greatest. I recently paid it down to just barely two grand, and hope to pay it down even further soon. How quickly does your credit rating go from bad to good? In other words, if you owe a certain amount, pay most of your CC off, and just have a pitance left, does it take a month, 6 months, year, etc. for your rating to turn around?
Thanks.
Thanks.
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You may already know this, but don't close that account when you do pay it off.
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If I understand correctly, you had several thousand dollars outstanding that you did not make any payments towards for years? And you recently made a large payment towards the balance?
If this was the ONLY credit item that you were late on (you were current on all other payments) you probably will have a score in the 400s? Not horrible but not good. I've seen credit scores below 200. (I work in underwriting)
Unfortunately, it will take YEARS for you to improve your score by a large amount. First, you will need to pay off the balance and then you will need to remain current on ALL PAYMENTS. Do not open any other finance agreements unless you must. Keep open your credit card(s) that you currently have and keep a small balance on them and pay it every month on time, so that the credit available to you is high in relation to your credit outstanding. For example, I keep $10,000 open but only have a few hundred dollars outstanding at any time.
If you do these things and consistently remain current it will probably take 2-3 years for your credit score to get into the mid 600s, which is the minimum of where you need to be to get a decent rate. Hell, sometimes you need that sort of score just to get APPROVED ever since the meltdown in late 2008.
was like a picture
of a sunny day
“We can complain because rose bushes have thorns, or rejoice because thorn bushes have roses.”
― Abraham Lincoln
It can be... because underwriters will look at your credit available (were other underwriters willing to extend you credit?) and how much credit you use. There should be a significant difference between the two. If you lower your credit available by cancelling a card... even if you just don't need it... it will impact your score.
I would just leave it open and don't use it - or use it minimally and pay it off each month so you don't pay interest.... assuming there aren't yearly fees just to own the credit.
I have 3 credit cards, am never late on payments (I pay them off every two weeks anyway) and I have a card I don't use (also the lowest credit limit) that I've been wanting to get rid of for a while.
no, no, I was never late on any payments, but I had one CC in particular that got high, but have since paid it down. I was never late w/any payments, but I'm hoping that since I've paid so much of it off that it's almost paid off completely, that my score will improve soon. I didn't necessarily have a horrible score, but I know it wasn't good and am hoping that now that FINCA can see most of my CC bill is just about paid off, that it will change for the better and soon. And yes, I won't pay it off completely.
if you have 3 other credit accounts and the one you want to cancel is fairly small then it won't impact your score much. especially since you make on-time payments every period.
no...you have to pay...I payed 7 bucks a couple years ago, I was car shopping and wanted to know...
here are some good reads:
http://www.pueblo.gsa.gov/cic_text/mone ... s/your.htm
http://clarkhoward.com/liveweb/shownotes/category/7/42/
From the first link:
Five Parts to Your FICO Credit Scores
As a rule, credit scores analyze the credit-related information on your credit report. How they do this varies. Since FICO scores are frequently used, here is how these scores assess what is on your credit report.
1. Your payment history – about 35% of a FICO score
Have you paid your credit accounts on time? Late payments, bankruptcies, and other negative items can hurt your credit score. But a solid record of on-time payments helps your score.
2. How much you owe – about 30% of a FICO score
FICO scores look at the amounts you owe on all your accounts, the number of accounts with balances, and how much of your available credit you are using. The more you owe compared to your credit limit, the lower your score will be.
3. Length of your credit history – about 15% of a FICO score
A longer credit history will increase your score. However, you can get a high score with a short credit history if the rest of your credit report shows responsible credit management.
4. New credit – about 10% of a FICO score
If you have recently applied for or opened new credit accounts, your credit score will weigh this fact against the rest of your credit history. FICO scores distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which inquiries occur. If you need a loan, do your rate shopping within a focused period of time, such as 30 days, to avoid lowering your FICO score.
5. Other factors – about 10% of a FICO score
Several minor factors also can influence your score. For example, having a mix of credit types on your credit report – credit cards, installment loans such as a mortgage or auto loan, and personal lines of credit – is normal for people with longer credit histories and can add slightly to their scores.
there is always a way to get a freebie. I applied with 5th 3rd back to refi my mortgage. They sent me a copy of my credit report with the scores from the 3 major agencies. Didn't cost me a dime.
from what I've read online, if you have a dispute with your credit score, you can call a number and punch in your account number on your report and that's the only way you'll speak to a live person. Everything else is automated.
ok...so there is a way...apply for a refi mortgage...
I guess that doesn't help those who are not looking to refi a mortgage and are simply wanting to know there score...
more good info:
http://www.ftc.gov/bcp/edu/pubs/consume ... cre24.shtm
ANNUAL CREDIT REPORT SERVICE
Congress recently established this outlet to make it easier for consumers to get their credit reports and credit scores from the three national credit reporting agencies.
Web:www.annualcreditreport.com
Phone: 1 877 322 8228
U.S. Mail:
Annual Credit Report Request Service
P. O. Box 105281
Atlanta, GA 30348-5281 The price for credit scores is being determined by the Federal Trade Commission Credit Reports and Scoring.
One free credit report per year from each credit reporting agency.
Each credit reporting agency offers a different type of credit score to consumers. FICO score via:
Equifax 300-850
Experian score 330-830
TransUnion score 150-934
http://pueblo.gsa.gov/cic_text/money/cr ... s/your.htm
exactly.
i didn't have the info handy b/c it's on my home computer, but i knew for a fact you are entitled to FREE credit reports EVERY year. do NOT use that freecreditreport.com, b/c you are actually signing up for a credit monitoring service that you will be charged for. just go to annualcreditreport.com.
and yea, isn't it crazy? getting rid of cards can negatively impact your score. mr. dream and i did it anyway, we just had too many cards over the years, most never/hardly used, just wanted them gone. one we did have a good long while, but as of right now...not much worry about our credit score. we already refinanced our mortgage a few years ago at a great rate, so unless the economy totally pummels, it won't get low enough to make a refi worthwhile. we have zero other debts and don't plan on taking any.....so figure the one card we do use, plus all our bill paying history, etc....enough to build up again to an excellent rating, that is if closing the cc accounts did have any impact.....never checked....
Let's just breathe...
I am myself like you somehow
or you can apply for a new mortage. you don't actually have to be shopping for home.
the annualcreditreport.com website only provides the details of credit report, but not a score...at least that has been my expierience.
Phone: 1 877 322 8228
U.S. Mail:
Annual Credit Report Request Service
P. O. Box 105281
Atlanta, GA 30348-5281 The price for credit scores is being determined by the Federal Trade Commission Credit Reports and Scoring.
One free credit report per year from each credit reporting agency.
Each credit reporting agency offers a different type of credit score to consumers. FICO score via:
Equifax 300-850
Experian score 330-830
TransUnion score 150-934
http://pueblo.gsa.gov/cic_text/money/cr ... s/your.htm[/quote]
exactly.
i didn't have the info handy b/c it's on my home computer, but i knew for a fact you are entitled to FREE credit reports EVERY year. do NOT use that freecreditreport.com, b/c you are actually signing up for a credit monitoring service that you will be charged for. just go to annualcreditreport.com.
and yea, isn't it crazy? getting rid of cards can negatively impact your score. mr. dream and i did it anyway, we just had too many cards over the years, most never/hardly used, just wanted them gone. one we did have a good long while, but as of right now...not much worry about our credit score. we already refinanced our mortgage a few years ago at a great rate, so unless the economy totally pummels, it won't get low enough to make a refi worthwhile. we have zero other debts and don't plan on taking any.....so figure the one card we do use, plus all our bill paying history, etc....enough to build up again to an excellent rating, that is if closing the cc accounts did have any impact.....never checked....
phew. annualcreditreport.com is what i used. BTW, some of you may want to weigh the pros and cons of refinancing since in some cases you can save several hundred dollars a month in payments but would go back in some cases to a 30 year loan. Here's a good list of pros and cons that I found online:
Pros:
1. Lower interest rates - probably the most important advantage of refinancing your house is getting rid of the higher rates and saving up as much as $150 a month from mortgage payments.
2. Term of payment can be extended.
3. Change your type of rate - refinancing can help you secure yourself from unexpected rate increases. You can choose to go to a fixed rate from a variable rate through mortgage refinancing.
4. Increase mortgage amount - with refinancing, this is now very possible. An increase in the amount of mortgage can help you settle other debts such as credit cards debts and personal loans. Of course, it still boils down to one thing - lower interest means more savings. Refinancing allows you to exchange one mortgage for another, pay off high interest credit card debts and enjoy a tax advantage all at the same time.
5. Lower monthly mortgage payments - refinancing your mortgage can allow you to ease your cash flow difficulties.
Cons:
1. Budget-dependent - since mortgage refinancing also means having more than your current mortgage, this also means that you would have to watch your budget more. Bear in mind that if you miss out on payments, you might lose your home.
2. Refinancing is cost-heavy - the total refinancing cost is composed of closing costs combined with private mortgage insurance premiums that you pay when you refinance your loan. Lost tax savings are also considered part of the refinancing cost.
3. You may have to pay more - If you are reckless in calculating your refinancing costs, you might end up paying more instead of saving more, especially in terms of interest charges. So make sure that you ask guidance from your lender to avoid this from happening.
4. Penalty involvement - There could be penalties that will be imposed on you if you fail to meet your obligations when you refinance your house. The best way to prevent this is carefully review the terms and conditions of your loan and follow it to the letter.
These are the important advantages and disadvantages of refinancing that you should consider. To help you find the best deals in house refinancing, you can turn to the internet to find the best home loan refinance services. It will be easier to compare refinancing deals through online services. A quick search will reveal hundreds of lenders that you can compare. You can also read reviews of refinancing companies to help you make your choice easier. By taking the time to research, compare and analyze, you will be able to choose the right refinancing deal for your house. Just bear in mind all these advantages and disadvantages before you make your decision.
Just like any other mortgage loan, this could work against your favor. To avoid this, discuss your options with your preferred lender. You can also ask guidance and recommendations from your tax advisor.
sure...but be aware of applying for credit...as doing so can effect your credit score...