I do owe that much about $600. and have plantry available credit on my cards, but I want to buy a house in about 6 months. I was told that if I pay them off and do not charge that it will lower my points which are around 680.
2007-08-20 16:36:39 · 5 answers · asked by Debbie 4 in Business & Finance ➔ Credit
Yes it will raise your score some.. but not that much because $600 isn't that much debt. You will need to use your cards and pay them off to build your score up. You can still use your cards if you are planning to buy a home, but just don't make any "major purchases".
2007-08-20 17:35:50 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Repairing the credit score is not that difficult provided you take these 5 simple steps into consideration.
1. Check your credit report regularly
This is a must to ensure that you know your current credit score, and what is ailing it. If there are any inconsistencies in your credit report get them corrected. Keeping bills of all the transactions you make can be very handy and helpful in correcting any errors in your credit report.
2. Get rid of those extra credit cards
The temptations to own a new credit card are so numerous in modern times that many of us end up with a purse-full of them without any real need. They stay there and cause a lot of problems in repayment. The confusion that comes with too many credit cards can easy lead to a missed payment and resulting penalties. Frequent defaults will reflect poorly on your credit score. So, keep only the necessary and discard the rest.
3. Repay on time
Every credit card transaction is a loan that has to be repaid on time with interest. Don't ever miss out on any repayment. If you are not able to make full payments, make half, or even the monthly minimum, but don't default. This will keep you in the good books of credit card company and help your credit score. If you are not able to pay anything to the credit card company, don't shy away from them, call them, explain your problem and work out things so that a negative report doesn't land up with the credit reporting agencies.
4. Keep your debt to balance ratio low
A low ratio means that you are repaying on time. This factor has carries a lot of weight while determining your credit score. A low debt to balance ratio goes in your favor while it hurts your credit report badly when this ratio is high. The high ratio says that you are not able to manage your finances well, borrow more than you can afford, and the repayment is not up to the mark-- in short a good candidate to accumulate a lot of credit card debt. Always, avoid giving this impression to the credit card companies. Read more from: http://www.credit-card-gallery.com/article/239,Credit_score_repair_in_5_simple_steps
2007-08-21 05:05:49 · answer #2 · answered by alexa dion 3 · 0⤊ 0⤋
Yes paying your credit cards off will increase your score. Carrying a balance doesn't help your credit score and you have to pay interest.
Only charge what you can afford to pay in full at the end of the month. You'll build a good payment history and the credit card companies will automatically increase your limit every year or so.
2007-08-20 23:57:29 · answer #3 · answered by bdancer222 7 · 0⤊ 0⤋
i worked for a credit reporting agency and it was my job to update and verify mortgage credit reports so i know what i'm talking about. keep your credit cards below 50% of the limit. when they go over this your score begins to drop. also make sure you pay on time. places can only report you if your 30 days or more late but i have seen one recent late date drop a score 100 points. also do not apply for any new credit cards or loans right now. recent inquiries can drop your score as well. wait untill your ready to start house hunting then go for your mortgage pre approval so you don't have alot of unecessary inquires. i would recommend pulling your credit report from all 3 major bureaus (equifax, trans union and experian) and checking them for accuracy now so you have plenty of time to fix things if you have to.
also don't stop using your card. it is a consistent good, long term credit history that helps. if you pay it off now and don't use it for the next 6 months there is nothing for a score to be based on.
2007-08-20 23:50:09 · answer #4 · answered by macy 3 · 0⤊ 0⤋
It depends on what the limit is.
6months is a long time to plan to purchase a house.
DO NOT MAKE MAJOR PURCHASES EVEN IF YOU PAYOFF THE CREDIT CARD THE NEXT DAY. Your credit card shows the 'HIGH balance'.
Make sure you have at least 3tradelines that have been open for the last 2yrs.
Make sure to payoff all the debt 2months before applying for the mortgage. This will take away any debt-to-income factors for revolving credit.
2007-08-21 00:55:50 · answer #5 · answered by Anonymous · 0⤊ 0⤋