Credit Card or No Credit Card

Anonymous · ‎01-12-2016

Hello Everyone- I'm 46 with no credit problems or history of.

But, because I never use credit cards, the bank automatically canceled my 1 credit card. As a result, I have no credit except for my mortgage which is only about 2yrs old. I live in the SFBay area so the mortgage is above average, but I pay it every month like a good boy without issue.

I just pulled my credit and its 719. Good, but not great. How do I improve this and is it a good idea to get a credit card in my name and use it every now and then? Any tips to get the credit score higher.

When i pull the report, it says the resons my credit is lower is:

The balances on your accounts are too high compared to loan amounts

Lack of sufficient credit history

Open real estate account balances are too high compared to their loan amounts

The date that you opened your oldest account is too recent

Thoughts?

Aahz · ‎01-12-2016

@Anonymous wrote:
Hello Everyone- I'm 46 with no credit problems or history of.

But, because I never use credit cards, the bank automatically canceled my 1 credit card. As a result, I have no credit except for my mortgage which is only about 2yrs old. I live in the SFBay area so the mortgage is above average, but I pay it every month like a good boy without issue.

I just pulled my credit and its 719. Good, but not great. How do I improve this and is it a good idea to get a credit card in my name and use it every now and then? Any tips to get the credit score higher.

When i pull the report, it says the resons my credit is lower is:

The balances on your accounts are too high compared to loan amounts
Lack of sufficient credit history
Open real estate account balances are too high compared to their loan amounts
The date that you opened your oldest account is too recent

Thoughts?

Why do you want to improve your score?

As long as you continue to pay your mortgage on time and do nothing else, your score will continue to increase slightly each month or two as a recult of a longer history and a lower utilization. Assuming you don't miss any payments your score won't drop until the mortgage is paid off.

If you want to plan that far ahead then get any $0 annual fee credit card, put a recurring bill on it (Netflix, cell phone, etc) and set the card for auto-pay. Then you can feel free to cut-up the card itself or "put it in the sock-drawer" in case of emergency. This will also cause your score to go up slightly month after month (after a brief initial dip) as long as you don't miss a payment.

Anonymous · ‎01-12-2016

@Aahz wrote:
@Anonymous wrote:
Hello Everyone- I'm 46 with no credit problems or history of.

But, because I never use credit cards, the bank automatically canceled my 1 credit card. As a result, I have no credit except for my mortgage which is only about 2yrs old. I live in the SFBay area so the mortgage is above average, but I pay it every month like a good boy without issue.

I just pulled my credit and its 719. Good, but not great. How do I improve this and is it a good idea to get a credit card in my name and use it every now and then? Any tips to get the credit score higher.

When i pull the report, it says the resons my credit is lower is:

The balances on your accounts are too high compared to loan amounts
Lack of sufficient credit history
Open real estate account balances are too high compared to their loan amounts
The date that you opened your oldest account is too recent

Thoughts?

Why do you want to improve your score?

As long as you continue to pay your mortgage on time and do nothing else, your score will continue to increase slightly each month or two as a recult of a longer history and a lower utilization. Assuming you don't miss any payments your score won't drop until the mortgage is paid off.

If you want to plan that far ahead then get any $0 annual fee credit card, put a recurring bill on it (Netflix, cell phone, etc) and set the card for auto-pay. Then you can feel free to cut-up the card itself or "put it in the sock-drawer" in case of emergency. This will also cause your score to go up slightly month after month (after a brief initial dip) as long as you don't miss a payment.

If you want to increase your scores, you're going to have to open and use credit cards. That doesn't mean carrying a balance. Just treat it like you treat a debit card and pay it off in full every month. I set mine to autopay. That way, you at least get some level of rewards over what you'd get from your debit card, with increased protection in case of fraud.

SouthJamaica · ‎01-12-2016

@Anonymous wrote:
Hello Everyone- I'm 46 with no credit problems or history of.

But, because I never use credit cards, the bank automatically canceled my 1 credit card. As a result, I have no credit except for my mortgage which is only about 2yrs old. I live in the SFBay area so the mortgage is above average, but I pay it every month like a good boy without issue.

I just pulled my credit and its 719. Good, but not great. How do I improve this and is it a good idea to get a credit card in my name and use it every now and then? Any tips to get the credit score higher.

When i pull the report, it says the resons my credit is lower is:

The balances on your accounts are too high compared to loan amounts
Lack of sufficient credit history
Open real estate account balances are too high compared to their loan amounts
The date that you opened your oldest account is too recent

Thoughts?

1. Yes I think it would improve your scores to get a credit card or two and use them now and then.

2. The mortgage is depressing your score, so if you're in a position to pay a little extra on it as you go along, you will get to a point where you get a 'bump' -- e.g. getting the balance down to 80% is generally believed to be a milestone.