Re: Question re: hard inquiries
04-22-2012 06:41 PM
Wow, so a CC company can decide to close your LOC just because and adversely affect your score? That's a little scary but good to know for the future. Yes they can do many things such as a large CLD (Credit Line Decrease) or do what is called "balance chasing" where each month as you pay down your balance they will lower your CL to match that balance so that your utilization always stays high. I don't want you to think that these practices are widespread but they do happen and it's good to be aware of it.
Interesting...I don't understand how that would benefit a CC company. As daunting as this process has been, I'm actually enjoying learning about the whole credit business. It's been empowering especially when I've felt overwhelmed and a little hopeless about it at times.
Well, I know I'm definitely not at the point where I can play around just to tweak my score for the fun of it (sigh, maybe one day). My first priority is qualifying for a mortgage loan (FHA) and then continuing to improve my credit from there.
I have 2 cards: one is a AmEx on which I'm an AU. I pay it off every month; so, it always shows a $0 balance. The second is a Capital One CC, which has been open since 2007. I haven't used it in several years (I don't even have a card) - I've just been paying the mininum every month (silly, I know) but this past week paid it down to a little less than 9% of the CL after reading about how utilization affects your score, My balance is $306 and the CL is $3500. I could pay it off but I know I need it to show a balance since my only other TL has a 0 balance. I could also go ahead and pay it down to the 1-3% utilization. Not sure if that would help more or not.... Right now that utilization is right at 9% (306/3500). You can play around with the percentages for a few months and see what seems to work best for you. The current 9% might be your sweet spot; perhaps the 1-3% is better.
Well, today is the due date for my Capital One CC payment. So, if I'm going to try out the 1-3% then tonight is it. Though once I bring it down, there won't be any going back up since I don't have a card! I think I might post a thread to see what others' experiences have been with re: to what percentage range of utilization has worked best for them.
This is all making my head spin, eye twitch, and giving me insomnia (as my 14 month old is actually starting to sleep through most of the night. Lol). And as I sit here watching her play, I know it's all worth it if she can have a home, a secure future, and a financially secure and stable role model
Thanks again for all of your help and your willingness to take the time to educate me on these matters.
Starting Score: EQ=567, TU=564 4/17/12
Current Score: 4/29/12 EQ 629 TU 618 (both FICO
Goal Score: 750
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