Any Know about Any of these Credit Score Questions?

Question

Questions about my credit score.....I'm new at this so some of these questions may seem basic....

Once ALL my credit cards are paid off in FULL and I owe nothing on them.....will doing so make my credit go up or stay the same?

AND.....how long after I get denied a credit card will that effect my credit score? And how long does it take to no longer effect your credit score?

Answer 1

It's amazing how many misconceptions there are about credit scores, and how many people who think they know it all, really don't know what they are talking about.

Question 1: Your balances have a major affect on your score, but especially your balance to credit limit ratio. The score examines how much of your total credit limit is used up, so if you pay off all credit cards, your score will go up.

Question 2: Being denied credit has no affect on your score, but applying for credit does. When you apply for credit, the inquiry appears on your credit file, but not whether or not you were accepted or denied. Credit inquiries remain on the credit file for 2 years, but only affect the score for 1 year. One credit inquiry within the past 12 months has some effect, 2 inquiries are more damaging, but after that it doesn't matter if you have 2 inquiries or 200 inquiries - the effect is the same.

I hope this answers your questions - they are very good questions - and good luck with your future credit score.

Answer 2

For the first question, it won't stay the same. If you pay everything off in one lump sum it will actually dip a bit initally then bounce back up. If you are paying them down over time it will improve your score but as you get closer to paying them off it will have less of an effect. It seems that the FICO scores like to see some debt on peoples history for some reason.


For the second question: Getting denined does not affect your score. What affects your score is the inquiry. People say it goes down when you make an inquiry which is true. However, if you have only 2-3 a year it will have very little effect. But if you start applying to every place and have more than that it will have a much worse effect on your score.

Answer 3

Credit cards are highly weighted in FICO scoring, so a maxing out credit cards will drop your score about 100 points. Paying them off will do about the same for your score, positively. Requests for your credit report will drop your score a few points. Best thing is to review this document at myFico.com which explains how different actions affect your score.

http://www.myfico.com/Downloads/Files/myFICO_CFA%20pamphlet.pdf

Perfect credit looks something like this:
1-2 credit cards
1-2 installment loans
1-2 mortgages
2-3 inquiries per year
no missed payments or collections
all accounts 5+ years or older
low balance -to- credit limit ratio

Answer 4

When your total card balance falls s below 50% of your total credit available, your score will start to rise within 30 days. Getting denied a credit card does not affect your score. Having multiple inquiries without any accounts opened can lower your score as much as 3 points per inquiry. These come off after about 6 months.

Answer 5

Every time you apply for credit(whether it's approved or denied) it pulls your credit score down. If you use more than 80% of your available credit on a card, your score goes down. There is no way to raise your score quickly. The best thing to always pay before the due date. If you have several cards, then paying some off will help.

Answer 6

1st question - it will go up and then down. The FICO is an "I love debt" score. You must have debt and love paying to get a good score. You get a higher score for maintaining a reasonable amount of debt. Its not a good thing. I can't wait till i have a score of 0 due to my not ever borrowing money again!!!

Inquiries stay on 3 years. Being denied a credit card has no greater impact +/- than being accepted. Its an inquiry.

There is more to life than a FICO!!!!

Answer 7

6 months

Answer 8

If you pay them all off you still don't have good credit. You need to borrow and pay as expected to build it back up and it can take years.