Some credit score questions

[thirtythree]

1. I have a credit score of 730. Is it worth trying to get it higher if I plan on buying a condo in the next couple of years?
2. Is it a good idea to try to increase credit limits when possible (I have 2 credit cards and one line of credit in case I deplete my checking account, which won't happen).
3. If I'm only going to use one of my two credit cards, should I still leave the other open?
4. Is it better to use both credit cards?
5. Is it bad to make small charges on my credit card? I sometimes charge a couple dollars, usually $20-30.
6. Should I wait till I get my credit card statement to pay it off? Usually I make one or two payments before I get my bill then pay off the bill balance once I get that.

The things lowering my credit score according to Experian:
- On average, many of your accounts have been open less than 3 years.
- Having low credit limits on your accounts and loans is lowering your score.

Thanks! Also, Experian is currently offering a free credit score for those who are interested. It enrolls you in a monthly program that you can cancel before the first month ends.

 

[bctbct]

Ask for credit line increases, do not open more accounts. Avoid "hard pulls"

 

[thirtythree]

Originally posted by: bctbct
Ask for credit line increases, do not open more accounts. Avoid "hard pulls"

I've read that credit line increases sometimes require hard pulls. Do hard pulls affect your rating long-term though? I have three on my record currently (through Experian anyway, but I think they are the only ones I've had recently).


EDIT: "Congratulations! Your credit line can be immediately increased by 1,000.00 for a total new credit line of 3,000.00.

During the evaluation process, a credit bureau report was not pulled."

Guess that answers my question for Citibank.

 

[kranky]

Originally posted by: thirtythree
1. I have a credit score of 730. Is it worth trying to get it higher if I plan on buying a condo in the next couple of years?

It would be better to get it up to 760 BUT it is not that big of a deal. You still have an excellent score. My question would be is that your FICO score? Where did you get your score from?

2. Is it a good idea to try to increase credit limits when possible (I have 2 credit cards and one line of credit in case I deplete my checking account, which won't happen).

Hard to say without knowing who issued your cards, how long you've had them, and what your current credit lines are.

3. If I'm only going to use one of my two credit cards, should I still leave the other open?

Absolutely, yes.

4. Is it better to use both credit cards?

Always use your cards at least a couple times a year. You don't want them cancelled for non-use.

5. Is it bad to make small charges on my credit card? I sometimes charge a couple dollars, usually $20-30.

No, it's not bad. The only people who don't like small charges are the stores because it costs them a percentage of your total PLUS a small fixed fee, and if you only buy a small amount of stuff they could be losing money on the transaction.

6. Should I wait till I get my credit card statement to pay it off? Usually I make one or two payments before I get my bill then pay off the bill balance once I get that.

Technically, it could be a benefit, but practically it's not. If you knew what day of the month your credit cards reported your balance to the credit reporting agencies, you'd want to pay in full just before that date so the balance they report is zero. What's more important is how much of your credit line you're using each month (what percentage)

The things lowering my credit score according to Experian:
- On average, many of your accounts have been open less than 3 years.
- Having low credit limits on your accounts and loans is lowering your score.

Thanks! Also, Experian is currently offering a free credit score for those who are interested. It enrolls you in a monthly program that you can cancel before the first month ends.

See answer to question 2.

 

[thirtythree]

Originally posted by: kranky

Originally posted by: thirtythree
1. I have a credit score of 730. Is it worth trying to get it higher if I plan on buying a condo in the next couple of years?

It would be better to get it up to 760 BUT it is not that big of a deal. You still have an excellent score. My question would be is that your FICO score? Where did you get your score from?

Hmm, good point. I got it from Experian, and it says it's a "PLUS Score":

Your PLUS Score is formulated using the information in your credit file. Your score helps potential lenders, landlords, and employers quickly gauge your credit history and decide what kind of a risk they are taking if they approve your application. Your PLUS Score can range between 330 and 830, with a higher score indicating a lower risk. There are many scoring models used in the marketplace. The type of score used, and its associated risk levels, may vary from lender to lender. But regardless of what scoring model is used, they all have one purpose: to summarize your creditworthiness. Keep in mind that your score is just one factor used in the application process. Other factors, such as your annual salary and length of employment, may also be considered by lenders when you apply for a loan.

It says my score is "Excellent" and is slightly above the national median, which I think is in the lower 700s for FICO scores as well.

2. Is it a good idea to try to increase credit limits when possible (I have 2 credit cards and one line of credit in case I deplete my checking account, which won't happen).

Hard to say without knowing who issued your cards, how long you've had them, and what your current credit lines are.

A local credit union and Citibank. The first I've had for 3.5 years, the second for 1.5 years. I'm 21. Current limits are 1000 and 2000. Checking line of credit is 500.

6. Should I wait till I get my credit card statement to pay it off? Usually I make one or two payments before I get my bill then pay off the bill balance once I get that.

Technically, it could be a benefit, but practically it's not. If you knew what day of the month your credit cards reported your balance to the credit reporting agencies, you'd want to pay in full just before that date so the balance they report is zero. What's more important is how much of your credit line you're using each month (what percentage)

So you're saying making frequent payments can't hurt me (though it may not help me), correct? Is using 30% of available credit a good goal? This is what an article I read suggested. Is this percentage based on my total monthly charges or my average balance?

Thanks for the reply!

 

[kranky]

I would consider asking the credit union for an increase in your credit line. If you've had it 3.5 years, with no problems, they will probably accommodate you. If they ask how much you want, ask for $8,000. If your income supports it they will probably agree or at least meet you more than halfway. If they want to know why you want an increase, just say the $1000 limit makes it difficult to make their card the one you use everyday.

I wouldn't ask Citi for an increase, but if you log in online you might find they will offer you an increase. If you see that offer and accept, you'll either get an instant approval or they will send you to a form to fill out. If you get the form, just cancel. The form will mean a hard pull. The instant approval isn't.

The PLUS score isn't a true FICO score, and you'll have to go to myfico.com to get one (it will cost). Might not be a bad idea to get your three scores now from myfico.com so you know where you stand. You might find your FICO score might be 50 points different up or down from the PLUS score.

Frequent payments won't hurt. The amount of your credit line you are using at any time is only a factor in your credit score, meaning that it's only relevant at any given moment. If you charge your cards up to 90%, then pay them down to 0, the fact that they were once at 90% is meaningless. There's no long-term strategy to keeping utilization at any particular number because you can always pay everything in full a month before you apply for credit to boost your score a little. But it's best to not go very high because banks are kind of crazy right now and watching people carefully.

Remember, your score is fine. There's some room for improvement, but if you do nothing at all you'll have no problem qualifying for a mortgage.

Do you ever receive applications in the mail for new cards?

 

[thirtythree]

Alright, thanks. I do get some credit card applications in the mail, though I don't seem to get many these days. Hopefully they've learned.

 

[IHateMyJob2004]

FROM EXPERIENCE:
I never had a credit card. I never paid anything late in my life. In 2002, I bought my first home. I was a lenders wet dream. I am a well educated, salaried engineer with a good credit score. The fact that I had little credit history did not matter. What would have mattered is delinquent credit card payments or $5,000 in CC debt.

You have more than enough credit and you have one credit card. That is all you need. Jsut keep paying your bills on time.

Don't believe me or anyone else here. Go to a local bank, like Bank of America and simply ask their opinion. Be sure to inquire about a mortgage. They'll be happy to answer questions so long as they expect you to be a future customer or the fact that you already have a checking account there.

 

[thirtythree]

Wow, I feel like a retard. I just signed up for myfico.com free trial and chose the "Bill me later" option without reading the fine print. Turns out that option does a hard pull that shows up on my new credit report. How bizarre. The good news is my Equifax score is 747. Not sure how to check the other agencies yet or if it's an option for the free trial...

 

[JoeKing]

Originally posted by: thirtythree
Wow, I feel like a retard. I just signed up for myfico.com free trial and chose the "Bill me later" option without reading the fine print. Turns out that option does a hard pull that shows up on my new credit report. How bizarre. The good news is my Equifax score is 747. Not sure how to check the other agencies yet or if it's an option for the free trial...

Fico is the big one most lenders look at since it's the oldest (tho not as accurate imo) rating.

 

[thirtythree]

Originally posted by: JoeKing

Originally posted by: thirtythree
Wow, I feel like a retard. I just signed up for myfico.com free trial and chose the "Bill me later" option without reading the fine print. Turns out that option does a hard pull that shows up on my new credit report. How bizarre. The good news is my Equifax score is 747. Not sure how to check the other agencies yet or if it's an option for the free trial...

Fico is the big one most lenders look at since it's the oldest (tho not as accurate imo) rating.

It is my FICO score, from Equifax. That's what it says anyway.

 

[IHateMyJob2004]

thirtytyhree,

You are worried about nothing. YOu are fine so long as you have a job.

 

[thirtythree]

Originally posted by: IHateMyJob2004
thirtytyhree,

You are worried about nothing. YOu are fine so long as you have a job.

Yes, I get that impression, mostly just curious at this point. Thanks