@ADH522 wrote:
FireMedic1,
Thank you for getting back with me. I took your advice and pulled my scores using a free trial at freecreditreport.com. The updated scores are as follows. Experian: 630 Equifax: 666 Transunion: 662. Experian and Equifax reflect no inquiries and transunion reflects 2 inquires; 1 on 3/5/18 and 1 on 1/4/18. They both show as coming off two years from the inquiry date.
So my scores are better than expected, but I would still like to bump them into that 700+ range what would you suggest my best course of action to be?
Also thank you again for helping me!
Your inquiries may be on your credit report for 2 years but you'll have gained all of the points back after 1 year. If you want to raise your scores, the last thing that you should do is apply for any new accounts.
For scoring purposes, your 23% utilization is too high. This also doesn't paint the whole picture since FICO takes into account both individual card utilization and overall utilzation. You can have 23% overall UTI but still have individual cards maxed out which would be a score killer.
Without knowing the ins and outs of every detail of your reports, ideally you would want to reduce the number of accounts reporting a balance. The AZEO(All Zero Except One) method is going to be your best bet. Pay all credit card balances to 0 except one and leave a small balance reporting on 1 card. You shouldn't go over 8.9% of your credit limit on any card but more importantly, your overall UTI should not exceed 8.9%. Paying off whatever you owe may take some time depending on your finances but that is the general direction you would want to head in. Hope this helps.
@ADH522 wrote:
Overmedicated,
I am thankful that you have taken the time to evaluate my profile and offer your advice. I am definitely working on paying off the high balance on my discover card. Fortunately I have been able to pay down everything else this year, and am hoping to have it paid off by the end of the year. I will take your advice on the AZEO method and keep my utilization below 8.9%
How long do you recommend I wait after lowering my utilization, before opening any new accounts?
Thank you again for your assistance it is greatly appreciated.
Well unfortunately opening new accounts is a necessary evil sometimes. Time is a big factor in determining scores. If you want a new card then apply. But you have to understand the scoring costs associated with the opening of a new account.
You often receive a score bump when your youngest account hits 12 months old. Whenever you open a new account, you are reducing the average age of accounts, resetting your age of youngest account to less than 12 months, and taking a point loss from the inquiry. This is the reason that I said you should not apply for any new credit if you are trying to improve your scores.
Just for reference:
People that are capable of having perfect scores have an average age of accounts somewhere around 7 years.
You can achieve perfect scores with 3 cards and a loan(you have 4 and a loan so this is good).
I know people including myself don't like to wait for things but a big penalty to your profile is it is young. Sometimes doing nothing to your profile is the best thing you can do.