@Anonymous wrote:I'm a 23 year old student fresh out of university and just got accepted to a medical school. I'm going to be taking out a loan from the bank and want to maximize my credit score before I go in. Currently reported on my credit report:
Visa #1, $3500 limit, 5% utilization, 3 year old card, no missed payments
Visa #2 $5500 limit, 35% utilization, 1 year old card, no missed payments
Student loan: $6600 loan, $1500 balance remaining, no missed payments
1 hard inquiry 2 months ago.
I would like to think that i'm smart with my money as a 23 year old student as I never miss payments, always try to pay off at least 50% of the balance on my card, seldom put anything on my card that I cannot pay before the end of my monthly cycle. I've also been able to pay off $5000 in student loans in less than a year. My main question is if I should pay off the entire balance of my government student loan before I apply for a bank loan for school, or pay off my government loan to $200 or so to keep the credit utilization there? I did an equifax report in the fall back when my student loan was still at $3000 and the % utilization was at roughly 50%, but do these government student loans have any affect on debt/credit ratio?
Thanks for the help in advance. Any tips, suggestions are welcome!
I'm a little confused here if you dont let balance report then your util is not that high, whats on the CRA is what matters, you could charge to the limit and pay it off before it reports if you have the cash or make multi payments in 1 month, ultimately you want to have one of these cards paid off to 0 and let the other report 1-9% of its CL to the CRA. Th student loans are installment loans and they hold little sway over your FICO, they are good for the mix of credit category only. Revolving cards are where you get the bulk of your FICO score (30% of FICO score is cc utilization % alone, 35% is payment history). Installment loans are going to affect your DTI so it depends on what your income is as to whether or not you would want to purge the payment from your current SL. I would also CLI those cards if you can, preferrably without a HP.
