Beef up your credit score, but don't overstuff it

[Anonymous]

http://www.marketwatch.com/news/story/realty-qa-beef-up-your/story.aspx?guid=%7B5AF5F033-66F9-4107-8...

Question: You always seem to be advising readers with poor or just OK credit on how to boost their credit scores. What if a person has no credit-card debt, no bad marks on their credit report, no other debt besides car and house, and a credit score of 769? How do I get my credit score into the 800s? Joe Mackinac, Chicago

Answer: A score of 769 is extremely good. Congratulations, you obviously know how to handle credit. But to try to push your score to 800 and beyond would be sweating the small stuff. A core of 800-plus won't get you a lower rate or better terms than you can obtain with a 769, so why bother? In the words of a famous Chicagoan, forgetaboutit.

...

Actually it's from Joisey--not Chicago. The Sopranos wasn't the originator. Heard it in Donnie Brasco and I think Goodfellas. So fuhgeddaboudit.

[Anonymous]

I believe a better responce would have been to answer the direct question which was asked. Just perhaps if the writer (in the event they have a fall from grace...illness,job loss or whatever)there by being able to improve their score now would be of benefit. RE; a 50 point drop from 800 is very differant than a 50 point drop from where they are now. Therefore a direct informative answer would have been more productive to that person AND OTHERS. thanks for the chance to respond. Ken

[marty56]

I agree.  You should strive to get your score as high as possible but not at the point of causing so much stress that you are afraid to use any credit card.

I charged $67 in gas at Chevron, PIF before the due date but missed the reporting date so it reported on my CR.  I lost one point on EQ.  Yes I know a point can make a big diffrence but I started to laugh about being upset since my scores are way better then they were 5 years ago and my EQ score went up 10 points for paying down my CC.

If only I had gotten stressed about 1 point all those years ago I would not have been in 70k of debt.

We seem to go from one extreme to the other.

[Anonymous]

Another reason not to bother to try and get a credit score over 760 is that, if you mess up, you'll probably end up close to where you would have ended up with a score in the mid-750s anyway. If you have a score of 740, a late payment will drop it around 50 points. If you have a score of 800, a late will drop it around 70 points. If you were at 830, probably close to 80 to 90 points. That's because the FICO formula "tries" to get you back to the effective mean, which is a little shy of 700.

[Anonymous]

There's nothing like running up high UTL, few inqs and new accounts and still staying over 760 to get your next loan.

How many people have to try to pay down debt, worry about inqs, check their reports to see when their score is high enough. When you start with a score in the upper 800's these things start to be less important. The person with the 800+ scores doesn't need wait for a CR update or pay down debt before applying for that next loan.

While I agree it doesn't matter if you are debt free with a score of 760 or 850, but for those that need to take on more debt that could take their 760 down to a 680. Now imagine if they needed debt and started at 840? Everyone can use more cushion. There is more you can do with a higher score. Because person A might only be able to carry 10% rev debt and person B might be able to carry 45% rev debt. Person B with a higher score has the ability to carry more rev debt and still score super prime.

But I don't think this post was about the advantage of a higher score, I think it was about would a higher score save more money at the time of applying? No, I agree.

[MidnightVoice]

Personally I like a high cushion, just in case.  But if not actively seeking credit, I just let things ride and don't sweat about it.

When thinking of a loan, I try and tweak to maximize, espacially as loan hunting can ding the score

Message Edited by MidnightVoice on 06-02-2008 02:26 PM