hello, credit help please??

[Anonymous]

Me and my husband are looking to buy a car but our real issue is everyone keeps denying us. What can we do to raise our credit scores from 630ish to high 700s?

Here's our debts (recently paid off a bunch), should we close those???

Paid off but open:	Balance Due		Credit Limit	Min Pmt
Macys	$               -		$         500.00	$           -
Kays Hubby	$               -		$       1,250.00	$           -
Von Maur	$               -		$         750.00	$           -
USB Adv	$               -		$         500.00	$           -
Zales Hubby	$               -		$       1,000.00	$           -
Capital One	$               -		$         750.00	$           -
Best Buy	$        168.54		$         300.00	$           -
Amazon	$          98.00		$         900.00	$           -
Zales Me	$     1,483.63		$       1,450.00	$      58.00
Kays1	$     2,270.00		$       2,700.00	$     140.00
NFM	$     2,446.43		$       2,500.00	$      98.00
Hubby GM Card	$     4,991.51		$       5,000.00	$     120.00
Flex	$     4,924.00		$       5,000.00	$      98.00
Plat Card	$     5,155.62		$       7,500.00	$     130.00
Travel Card	$     3,374.29		$       5,000.00	$      98.00

[laz98]

several of your cards are close to maxed out.  i wouldn't close a thing right now, because it can only hurt you.

start paying those balances as fast as you can!  your credit utilization, how much of your available credit you are using, is a huge part of your score.  having several cards close to their limits is really hurting you.  once you get them down you will see a big difference.  i don't think it will be over 100 points, but guesstimates are not my area.

[Anonymous]

+1.  I agree with Laz.

It would also help a ton if you separated you and your DH's cards into two separate lists.  That will help you know what to attack next and in what order.  You'll want to watch overall utilization, individual utilization, as well as number of accounts reporting a balance - FICO pays attention to all of those.  And, of course, you will want to weigh APR's as you pay down.   Are either of you AU's on each other's cards?  If so, that balance is showing up on both CR's and you may want to consider pulling the AU off.

Oh, and welcome sarahkay1985!  This is a great place - Glad to see you on the boards and posting here! 

[llecs]

Welcome to the forums!

Did they say why they denied the car loan? A 630 FICO isn't that bad. Could your debt-to-income ratio been an issue? Excluding housing which needs to be factored (in the eyes of your lender), your monthly obligations as posted is about $750/mo. Add rent or mortgage and divide both into your monthly gross and that percentage could have put you over their comfort level. On the flip side, paying down revolving, as you are doing, will reduce the DTI and improve your FICO at the same time.

If my math is right, your utilization is 72% assuming ALL of the cards reporting $0 are currently open. This is taking your listed balances and dividing them into the CL. This calc. excludes Macys which does not factor into utilization because they don't report a CL. I'm assuming here that your other CCs are reporting a CL as listed. I bet if you paid down all of your CCs to $0 and left one with a small balance of under 9% of the CL, then you'd see a gain of 60-90+ points. You have at least one CC that is over the limit and there's an extra FICO ding due to that. Once paid down and report as such, you'll see some nice gains and you would likely reach 700. BTW, this is assuming your 635 already factors in your paid balances, which they might not at this point. Your scores could be higher once those report. FICO likes $0 balances (and lenders too) so I personally would focus on the smaller balances first.

I would only close the cards if they charge a fee. Otherwise, I'd leave them open and use every 3-4 months for a pack of gum or for a $4 cups of coffee at Starbucks. PIF of course and remain debt free (per CCs). Also, once you close a $0 balance CC, it is forever removed from FICO scoring per utilization, so I personally wouldn't recommend closing them until after the car purchase.

ETA..............dag gum, I'm a slow typer. Stupid work activities interferring with my slow typing skills.

[Anonymous]

good point on the DTI llecs!

[p-]

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@Anonymous wrote:

Me and my husband are looking to buy a car but our real issue is everyone keeps denying us. What can we do to raise our credit scores from 630ish to high 700s?

Here's our debts (recently paid off a bunch), should we close those???

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You owe almost 25,000 dollars in credit card debt.  Your problem isn't the number of cards, it's your utilization.  You should pay off more of these if you want to look less likely to default.  Best is if all are 0 balance except one has 3 to 9%.  You should also look at the rest of your credit report.  If there are Collections, Lates, or other derogs that could prevent you from getting auto financing you need to GW, PFD, or do what it takes to clear them.

I don't know what your financial situation is, but if you can get by with the wheels you have until you pay these off and clean up your report you'll be much better off.  I recommend you commit to spending 12 months doing that, including reading here to find out how to improve your credit.  Make sure you pay off the highest interest cards first.  Then, at the end of 12 months the inquiries you have will be gone, and hopefully you have a better utilization picture.

At that time go to your credit union or bank and get a pre-approved loan for a car.  Take that with you to car shop, and you'll get a better deal.

Credit is a game of patience and perserverance.  Waiting until you are in a better position will put you way ahead of the game in the future.

Good luck!

[Anonymous]

thanks everyone, yea we make 38000 and 35000.. our house payment is 980 a month... we afford everything comfortably but really want to buy a car.. they say revolving balance is too high... i already know that.. i've been working on paying a lot of them off... should I pay each of them half off instead of working on paying one in full every time?

[Anonymous]

If there are Collections, Lates, or other derogs Nope, absolutely no lates or collections ever on either of our credit files. His score is 663 and mine is reported above. I have a lot more credit in my name then he does though.

[Booner72]

Hi SarahKay -- I'll tell you what my scores did and maybe that will help.  I had 4 cards maxed out.  I paid down to 31%  and only got 10 points.  What I have read here says to pay as many as possible to zero to increase points.  If I were in your shoes, I would nail one at a time, getting them down that way.  But that's just me and maybe somone else has a different opinion.

However, I am sure I am in a different scoring bucket than you are because I have lots of derogs and you have clean credit.

Good Luck.

[p-]

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@Booner72 wrote:

Hi SarahKay -- I'll tell you what my scores did and maybe that will help.  I had 4 cards maxed out.  I paid down to 31%  and only got 10 points.  What I have read here says to pay as many as possible to zero to increase points.  If I were in your shoes, I would nail one at a time, getting them down that way.  But that's just me and maybe somone else has a different opinion.

However, I am sure I am in a different scoring bucket than you are because I have lots of derogs and you have clean credit.

Good Luck.

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From what I've read, the key utilization buckets are Less than 10% and Less than 30%.  It's my understanding that until you get below 30% utilization you won't see the benefits in your score, then the next major jump will come when you get bleow 10.

I can tell you I've seen my score drop significantly if I show greater than 10% utilization on my revolving lines...  So it stands to reason that reducing it would help you.