Revolving & Installment Balances

[Anonymous]

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@jmbfl wrote:
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This is the place where those store cards you are lukewarm about because of the APR's begin to pay off. They don't get closed down quickly when they are SD'ed!

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My wife has a JCPenney card that she hasn't used for at least two years (she said she thinks she cut up the card long before that) but they keep faithfully reporting good information EVERY month!

[brendog]

I just graduated last summer and my student loans kicked in in the fall, increasing my # of installment loans.  I now have 5 revolving accounts (4 credit card and an overdraft showing as revolving) and 5 installment accounts (4 student loans plus an auto loan).  I PIF every month on all but 1 low-balance credit card ($50 balance on $3000 limit card).  However, it is impossible to have fewer than 50% of my TAs with 0 balance because of the active student loan accounts.

I am trying to recover from bk discharged Jan 2005.  I am also trying to buy a house in the next few months for 1st time and am oh-so-close to 700 to get the best interest rate.  What should I do?  I have the cash to pay off the auto loan, if that would help, but the math is still not right to keep 1 revolving non-zero and have less than 50% of TAs with zero balance.  Should I open another credit line or overdraft with my other bank?  I think this would hurt my score more than help it by making my credit look younger on average, right?  The same problem exists if I try to consolidation loans.  I just have 2 student loan companies that seem to be reporting 2 each: the subsidized and unsubsidized portions separately.

Any advice?

[Anonymous]

Two thoughts until the experts come along-

Do you PIF before the statement posts?  Most credit card companies report the balance on your statement so if you wait to pay off the cards until you get the statement then all of those balances will show up on your credit report.  For best effect, pay all but one card off before the statement even closes, and pay the last card off after the statement posts but before the due date.  

Then for the mortgage part, the top tier rates are around 720 I believe, for conventional mortgage.  If you go FHA route, I think you get the best rates after 620 so it's a little more lenient.  (These are taken from Post from Mortgage Board Shane's post in July so maybe things have changed a bit with the credit crunch, but you could ask to be sure.)  Not to say don't worry about your credit but if it gets to the point of opening accounts you don't really want and that sort of thing, I wouldn't bother personally   I can usually get 10 points for messing around with my utilization but I haven't found a way to get a quick 20 points, is all I'm saying..

[Anonymous]

Actually, In my experience, Having lower balances and even a Zero balance on Revolving accounts raised my score substantially. Now the Term debt, paying those off in full did not help the score as much. Having a low Balance to credit limit is really the key to having a higher credit score. Of course, The whole credit bureau thing is a Rip off anyways. Their score doesn't  equal didly squat.

[Anonymous]

Last year I applied for a Business card in my name and subsequently learned that business cards don't affect my personal FICO--i.e. that business credit cards are reported to a separate business credit bureau. SO, if I wanted to optimize my personal FICO score before applying for a mortgage, etc, would it make sense to us my business card exclusively for an interval and make all (or all but one) of my personal credit card account balances to report as "Zero"?