@redsoxguy676 wrote:
Hello everyone. I am a 24 year old male with 2 credit cards and an auto loan. My two cards are Discover IT and BOA Cash Rewards. The IT card has a limit of 10k and the BOA has a limit of 2.5k. No balances on either card. My auto loan was originally applied for and accepted though chase in march of 2011 for 12.5k and I have paid it down to 6.5k since then.
My current fico scores are TU 762 and EXP 759. I am looking to increase my scores, but I am not quite sure how to. Does anyone have some insight as to how to increase my scores in the coming months, years, etc...
I also use the FICO quarterly monitoring product as well.
Thank you in advance for any ideas or comments!
For maximum scoring purposes you should not have both cards reporting a $0 balance. Allow one of them to stay at zero and keep the other card between 1%-9% this should gain you a few extra points.
*8/10/13
PIF is great but again for scores you should allow one of the cards to report a balance if you are not already doing so.
What enharu and dodfire are explaining is called utilization - and it is a large chunk of your credit score. At any given time you want to make sure that is low, but unfortunately the system is a little "backwards" since your balances typically get reported at statement creation date, not after your due date. So even though you pay in full, everything you charged from the previous month likely still shows up on your credit report. It's wacky, and most people don't figure that out until they start scouring the Internet and finds these forums, or other forums out there.
Easiest way to fix that is to make payments early in the month, before the statement date, and then another payment by the due date. Whatever you do, ALWAYS pay the minimum balance due. But, here's the other trick - scoring models have no memory of utilization, so if you charge up to your credit limit this month and pay down next month, your score will look weird this month, but perfectly normal next month. So what I do is try to manage my utilization to optimal levels only when I am applying for new credit. Otherwise, what do I care if my utilization is a little out of whack? No one is looking at my credit score unless I apply for something. Trying to manage utilization all the time just gets tiring.
Here's other things that factor into credit score (in some way or another). This is not an exhaustive list.
- Average Age of Accounts - that is, the age of each of your tradelines on average. You can't do much to improve this one, except to be smart when applying for new credit. New cards and signup bonuses are wonderful, but will hurt your score in the short term. Make sure it's worth it. With that said, I have opened 5 cards in the last 13 months and plan on about 2 or 3 more over the next year. What good is having good credit if you don't use it to save yourself money?!?
- Inquiries. Of the hard variety only, and obviously these are usually the result of opening new accounts or requesting credit increases. Just like above, keep these to a minimum.
- Mix of credit. You have installment loans (auto) and credit cards, so you're doing fine here. But, if the rumors on these boards is true, having at least 3 revolving tradelines may actually lead to credit gains in the long term (once the inquiries and new account ages). That is not considered a fact by any means, and I haven't experienced any significant gains since acquiring my third tradeline But if three is indeed it is the "optimal" number of revolving tradelines for score purposes, then it would help you to add a new credit card account.
In all honesty, with such good credit, I kind of question why you don't already have more. There are huge signup bonuses to be had and great spending rewards to be made. Be responsible with it, but go out and use your good credit!
Oh yeah, and you aren't going to hit 800 at 24, and you might not even hit it at all in your 20s. It takes a long credit life to jump over that 800 hurdle, so there really isn't any rush. Your current 760+ scores will get you into the approval pile (depending on income, debt, and other factors) at almost every lender in America. There really isn't anything much to improve into. Congrats, and keep up the good work!
Easiest way to fix that is to make payments early in the month, before the statement date, and then another payment by the due date. Whatever you do, ALWAYS pay the minimum balance due. But, here's the other trick - scoring models have no memory of utilization, so if you charge up to your credit limit this month and pay down next month, your score will look weird this month, but perfectly normal next month. So what I do is try to manage my utilization to optimal levels only when I am applying for new credit. Otherwise, what do I care if my utilization is a little out of whack? No one is looking at my credit score unless I apply for something. Trying to manage utilization all the time just gets tiring.
Here's other things that factor into credit score (in some way or another). This is not an exhaustive list.
- Average Age of Accounts - that is, the age of each of your tradelines on average. You can't do much to improve this one, except to be smart when applying for new credit. New cards and signup bonuses are wonderful, but will hurt your score in the short term. Make sure it's worth it. With that said, I have opened 5 cards in the last 13 months and plan on about 2 or 3 more over the next year. What good is having good credit if you don't use it to save yourself money?!?
- Inquiries. Of the hard variety only, and obviously these are usually the result of opening new accounts or requesting credit increases. Just like above, keep these to a minimum.
- Mix of credit. You have installment loans (auto) and credit cards, so you're doing fine here. But, if the rumors on these boards is true, having at least 3 revolving tradelines may actually lead to credit gains in the long term (once the inquiries and new account ages). That is not considered a fact by any means, and I haven't experienced any significant gains since acquiring my third tradeline But if three is indeed it is the "optimal" number of revolving tradelines for score purposes, then it would help you to add a new credit card account.
In all honesty, with such good credit, I kind of question why you don't already have more. There are huge signup bonuses to be had and great spending rewards to be made. Be responsible with it, but go out and use your good credit!
Oh yeah, and you aren't going to hit 800 at 24, and you might not even hit it at all in your 20s. It takes a long credit life to jump over that 800 hurdle, so there really isn't any rush. Your current 760+ scores will get you into the approval pile (depending on income, debt, and other factors) at almost every lender in America. There really isn't anything much to improve into. Congrats, and keep up the good work!
