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Confused on how to raise credit score.....

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takeshi74
Senior Contributor

Re: Confused on how to raise credit score.....


@Berk wrote:

Start here:

 

http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/bd-p/ficoscoring 


Deifnitely start there.  It doesn't cover everything but it does tell you how the usual factors are typically weighted.  Start with the biggest factors first.

 

If you have derogs then work on addressing them as they impact Payment History.  Hit the Rebuilding subforum and carefully research to see what you can do.

 

Amounts Owed is the second biggest factor.  Revolving Utilization falls under this and has a significant impact.  If your revolving utilization isn't in check then get it in check.  Revolving utilization is simply balance(s) / limit(s) as indicated on your reports.

 

Most other factors take time and responsible management.

 


@Anonymous wrote:

The only reason i have a balance is because I read that if you have a balance your CS would increase...


You need to carefully read, consider your sources, corroborate, validate, etc.  You partially understand this particular matter.  Here's the breakdown:

  • Revolving utilization has a significant impact.
  • General advice is do not exceed 30% but that is just a suggested max.  It is far from ideal.
  • Lower is generally better as long as you don't have all your revolving accounts reporting 0 balances.
  • Number of reporting balances also plays a role and lower is generally better but you want at least 1 reporting.
  • If you want to eke out additional points, such as when applying for new credit, requesting CLI's etc then you may want to allow only one balance to report with very low revolving utilization.  However, you don't need to constantly do this.  Just generally aim to keep it under 30%.

 

You also seem to be conflating carry and report.  You want at least one revolving account to report.  You don't have to carry to have a balance report.  You can pay every statement balance in full, avoid incurring revolving debt, avoid interest and still have one or more balances report.

 

Whether a balance reports or not is all a matter of when you pay off the balance versus the report date.  If you pay the balance to 0 by the report date then 0 will report.  If you pay after the balance reports but by the due date then the balance has already reported and your payment will not impact the balance that has already reported.

 

 

These are all very common topics so don't overlook the existing threads as resources.  Don't expect to get it all at once.  Take the time and effort to read and educate yourself.  Don't overlook the different subfora and the stickies in each subforum.

 


@Anonymous wrote:

Well i lost 10 points


Don't just fixate on the numbers.  If you're going to worry over score changes then set a higher threshold.  I'd recommend at least 20 points as your scores will vary just from normal activity and you'll go crazy worrying over small changes.  Better yet, learn to evaluate your own reports and focus on the report data.  You'll want to be able to do that in the long run anyway.

 


@Anonymous wrote:

I am a member of NFCU 22yrs no line of credit and no CC... paid THEM off and closed both before BK7.....


The BK will hold you down as long as it's on your reports but you can work on other items.  I've been through it myself and if you spend the time to resolve all your other issues you'll come out stronger in the end once the BK falls off.

 


@Anonymous wrote:

I HAVE 15+ INQ because of buying a car in 2014 and refi same car in 2015 other inq were for dumb request like applying for JCP IN 2014 AND WAS DENIED and re-applying a month later for same card just to get a discount...


Despite the obsession over them inquiries are a relatively small factor.  Auto shopping inquiries will be scored as one as long as they are coded properly and within a given timeframe even though they show up separately on reports.  With your BK and other issues you're probably seeing a bigger impact from inquiries but that's because of your credit profile.  As your credit profile improves you'll see less impact from the inquiries.

 

Still, during all this you need to have an idea of how much credit seeking activity and new accounts your credit profile will support.  It will probably be quite limited for a while.  Again, it's not just the new inquiries.  Having new accounts on your reports has an impact as well and new accounts also drop your AAoA (Length of Credit in the link above).

 

Even when you are in better shape, new accounts will still have an impact.  A while back I received low limits (for me) because of recent activity despite having FICO 8's near 800 at the time.  As those accounts and activity aged those limits increased.

Message 11 of 13
Anonymous
Not applicable

Re: Confused on how to raise credit score.....

Thanks for taking the time to break it all down...I had been reading for awhile now...still have lots to learn....!

Message 12 of 13
Anonymous
Not applicable

Re: Confused on how to raise credit score.....

Thanks for taking the time to break it all down...I have been reading for awhile now...still have lots to learn....!

Message 13 of 13
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