Credit Score Secrets

Do you want to raise your credit score?  Have you ever been turned down for credit and wondered why?  After all you are a dependable person, one who pays their bills on time.  How could they turn you down?  Right!!

Here are 6 things you may not have thought of that could lower your credit score:

1.  Credit inquiries stay on the books for a year.  So don't apply for several cards a month apart.  Don't get a Sears in January, a Penney's in February and buy a car in March.  Do it all at once because within a 2 week period they know you are shopping around.  Do all the credit cards at one time and all the car shopping at one time.  But remember if you are applying for several credit cards, it may look as if you are underwater and wanting new cards to pay debts. 

2.  Everyone needs at least 1 major credit card.  But  you believe in cash!  That's good, but let's say you fly into San Antonio to see your grandkids and want to rent a car for the week.  Without a credit card, a rental store won't let you drive off the lot with their cars.    I use to have a mother-in-law - yes, she is no more, she left when her son did--and she wanted to buy a car.  She had always paid cash, but this time, it was going to hurt because it was a new car - not used as in past, and taking $25,000 out of savings is HARD.  So she decided this one time she'd use credit.  Guess what, she had no credit score.  She'd NEVER bought anything on credit (wish that was me).  So her son had to go on her loan since he had a lot of credit until she built up her own by making the payments on the car.  Eventually she just paid the car off with money from savings, and her credit score bumped up real fast.  I think she can buy anything she wants now for credit.

3.  Don't cancel cards.  I know, you're saying but we only need one major one.  Yes, but if you cancel, it actually makes your score go DOWN.  Instead cut them up and throw them away, or hide them from yourself so you have to really need them to find them. 

4.  Don't let an account get 30 days overdue.  It'll go on your record, and down will come the score.

5.  Never use over 30% of the balance allowed, and 25% is preferable.  The more you owe lowers your score, and you could be one layoff away from disaster.

6. Don't co-sign for someone else.  The debt is added to your records, which lowers your score, even though they are the ones paying it.  If they get laid off and default, then you will be held responsible for their debt and you might just have to default too.

Remember, if you get turned down, they have to tell you why.  A new law even says they have to explain it better than ever, what is on that report that sunk your boat.

Never, ever lie about your score, as it's just too easy for them to check.  Be honest.  If you were sick and missed some payments, don't try to gloss over it.  Be honest and above board, and who knows, they might have gone thru the same thing themselves and actually have a heart.  Honesty is always the best policy.