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Credit Cards lowing available credit causing lower credit score

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Anonymous
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Credit Cards lowing available credit causing lower credit score

I have two credit cards and my husband has two as well.  We both are authorized on eachothers cards so his show on my credit report and mine show on his.  In the past couple of years, the credit card companies keep lowering our available credit to the same amount of our balance owed.  Our balances are high and we can not pay them down completely because my husband has been layed off for the past 18 months.  Because of the high balance on my credit cards my fico score is  637 right now.  I need to refinance my house and with a low score my interest rate is not going to be as good as if I am able to raise it.  I have one 30 day late payment from three years ago with Honda financial.  I also have one 30 day late with marriott from two years ago.  The rest of my report is very good. 

 

Can anyone suggest a quick way to raise my credit score so I don't get hurt on my interest rate?

 

Thank you,

Message 1 of 6
5 REPLIES 5
Anonymous
Not applicable

Re: Credit Cards lowing available credit causing lower credit score

Hi and welcome,

 

I am in very much the same boat as you. Last month I recieved a CLD notice from 2 cards (same bank - BOA). I have one 30 day late from last year. It really hurt my score. I can't quickly pay them down so I have just been really cutting back (got rid of cable tv) and putting anything extra on my higher interest card.

 

That's the only thing I can think to do. I may have to find part time work but that can be tough (single parent).

 

Anyone with suggestions?

Message 2 of 6
llecs
Moderator Emeritus

Re: Credit Cards lowing available credit causing lower credit score

OP, the best way and fastest way to increase your score is via lowering CC utilization.

Message 3 of 6
Lel
Moderator Emeritus

Re: Credit Cards lowing available credit causing lower credit score

Are you trying for a conventional refinance, or FHA? If the latter, then interest rates are not score-driven.

 

Remember that there's much more to mortgage loans than just your FICO score.  If your CC minimum payments are high, then this could make a big impact in your debt-to-income ratio.  If your family's loss of income affects DTI as well, this could make refinancing difficult even if your scores improve.

Message 4 of 6
Anonymous
Not applicable

Re: Credit Cards lowing available credit causing lower credit score

Refi would be conventional. 

 

DTI ratio has definitely changed but fortunately with my income we still qualify from a financial aspect.  The main problem with the loss of income is that we are not able to pay off the cc debt, or any other debt like we did in the past.  It will be paid over years instead of within a year.  I stopped using the credit cards sometime ago so I haven't incurred additional debt.  However, because the cc companies keep lowing my available credit when the card is paid down it kills my score.  

Message 5 of 6
Anonymous
Not applicable

Re: Credit Cards lowing available credit causing lower credit score

Scores don't effect FHA loan?

Message 6 of 6
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