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Need some advice


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24 replies to this topic

#1 Filter

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Posted 26 February 2012 - 05:46 PM

I've read up alot on this subject and can't seem to find the proper answer.

I pulled my score and it is good (740).
I want to improve it as I would like to apply for a mortgage soon.
I only have one account that is ten years old with a small balance ($400).
I used the simulator on credit karma and if I open a new card my score stays the same. If I open a personal loan , it will drop 30 points.
What can I do to improve my score?



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#3 mike82fl

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Posted 26 February 2012 - 06:06 PM

Is that score from credit karma?

credit karma is not an accurate score, it is a FAKO not a FICO, so don't put too much weight in it.

how soon do you expect to mortgage app? watch inquiries and new accounts if it is within the next year.

do you have any negatives, lates, collections, etc?

the simulator isn't that accurate on CK.

what kind of card do you have now? any installment loans at all (car, student loan etc.).

#4 Frank13

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Posted 26 February 2012 - 06:08 PM

What is your ten year old account with the $400 balance? I presume that it is a revolving account - what is the credit limit?

#5 Filter

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Posted 26 February 2012 - 08:07 PM

Is that score from credit karma?

credit karma is not an accurate score, it is a FAKO not a FICO, so don't put too much weight in it.

how soon do you expect to mortgage app? watch inquiries and new accounts if it is within the next year.

do you have any negatives, lates, collections, etc?

the simulator isn't that accurate on CK.

what kind of card do you have now? any installment loans at all (car, student loan etc.).


That score was from CK. I just ordered experian, equifax , and transunoin to verify it as atleast close. I have a 761, 730 and 738, so CK was pretty accurate in this case.

Right now I just have the one credit card. I havent had a car loan in several years , and just this credit card for the last few years. Payments are 100% on time.

Would you advise opening a second credit card or a personal loan?

I would like to get a mortgage in 6-9 months.

Hope that answers all the questions.If I am missing something please let me know.
Thanks in advance.

#6 Filter

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Posted 26 February 2012 - 08:09 PM

What is your ten year old account with the $400 balance? I presume that it is a revolving account - what is the credit limit?


It is a credit card. Limit is only $2000. It's with a shitty bank, as I got it when i turned 18. I already asked for them to lower the interest rate and they said all rates are the same for everyone. I want to close it , but it would really screw up my credit score.

#7 LKH

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Posted 26 February 2012 - 08:18 PM


What is your ten year old account with the $400 balance? I presume that it is a revolving account - what is the credit limit?


It is a credit card. Limit is only $2000. It's with a shitty bank, as I got it when i turned 18. I already asked for them to lower the interest rate and they said all rates are the same for everyone. I want to close it , but it would really screw up my credit score.



Do NOT close that credit card. First, get that balance below $200 or 10% and you might get a few points increase. Second, if you have a relative that has long time credit card accounts, you might ask for them to add you as an authorized user on a couple of them. Make sure that the balance on their cards is low and that it stays there. If going for a mortgage within 6 months, I would suggest that have no new inquiries before you close on your loan. Inquiries could knock a few points each and a new trade line may or may not cost a few points.

#8 Frank13

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Posted 26 February 2012 - 08:24 PM

If going for a mortgage this year I agree with LKH that you should not apply for any other credit. If your mortgage shopping won't be until next year I would add 1 or 2 more revolving accounts.

#9 mike82fl

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Posted 27 February 2012 - 12:24 AM

All the advice here so far is spot on.

Where did you order the 3 scores? Were they labelled as FICOs or as vantage, plus, transrisk, or some other name.

#10 Filter

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Posted 27 February 2012 - 07:55 AM



What is your ten year old account with the $400 balance? I presume that it is a revolving account - what is the credit limit?


It is a credit card. Limit is only $2000. It's with a shitty bank, as I got it when i turned 18. I already asked for them to lower the interest rate and they said all rates are the same for everyone. I want to close it , but it would really screw up my credit score.



Do NOT close that credit card. First, get that balance below $200 or 10% and you might get a few points increase. Second, if you have a relative that has long time credit card accounts, you might ask for them to add you as an authorized user on a couple of them. Make sure that the balance on their cards is low and that it stays there. If going for a mortgage within 6 months, I would suggest that have no new inquiries before you close on your loan. Inquiries could knock a few points each and a new trade line may or may not cost a few points.



Ok, so just hang tight with what I have?
Unfortunately I do not know anyone that I can ask to add me , so I'm sol there.

Would the score drop because of the inquiry or because the age of the new line of credit?

#11 johnnyderp

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Posted 27 February 2012 - 09:33 AM




What is your ten year old account with the $400 balance? I presume that it is a revolving account - what is the credit limit?


It is a credit card. Limit is only $2000. It's with a shitty bank, as I got it when i turned 18. I already asked for them to lower the interest rate and they said all rates are the same for everyone. I want to close it , but it would really screw up my credit score.



Do NOT close that credit card. First, get that balance below $200 or 10% and you might get a few points increase. Second, if you have a relative that has long time credit card accounts, you might ask for them to add you as an authorized user on a couple of them. Make sure that the balance on their cards is low and that it stays there. If going for a mortgage within 6 months, I would suggest that have no new inquiries before you close on your loan. Inquiries could knock a few points each and a new trade line may or may not cost a few points.



Ok, so just hang tight with what I have?
Unfortunately I do not know anyone that I can ask to add me , so I'm sol there.

Would the score drop because of the inquiry or because the age of the new line of credit?


Potentially both, but your score would recover and improve if there's enough time between now and your mortgage app. After 6 months an inq wouldn't be a problem, but a trade line you add now would still be considered new.

I don't know if it's better to have a 2nd 6 month old trade line vs a thin file when you app for a mortgage. In your case you already have a good score and not enough time for a new trade line to mature.. no one to add you to an old account as an AU... I'd just not poke the bear. Pay the one account down to a very small balance at least a month before you app and definitely don't close it.

Hopefully your good payment history and proof of solid income/employment history will do the trick. Are you going FHA or VA or big down payment?

#12 Filter

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Posted 27 February 2012 - 02:51 PM





What is your ten year old account with the $400 balance? I presume that it is a revolving account - what is the credit limit?


It is a credit card. Limit is only $2000. It's with a shitty bank, as I got it when i turned 18. I already asked for them to lower the interest rate and they said all rates are the same for everyone. I want to close it , but it would really screw up my credit score.



Do NOT close that credit card. First, get that balance below $200 or 10% and you might get a few points increase. Second, if you have a relative that has long time credit card accounts, you might ask for them to add you as an authorized user on a couple of them. Make sure that the balance on their cards is low and that it stays there. If going for a mortgage within 6 months, I would suggest that have no new inquiries before you close on your loan. Inquiries could knock a few points each and a new trade line may or may not cost a few points.



Ok, so just hang tight with what I have?
Unfortunately I do not know anyone that I can ask to add me , so I'm sol there.

Would the score drop because of the inquiry or because the age of the new line of credit?


Potentially both, but your score would recover and improve if there's enough time between now and your mortgage app. After 6 months an inq wouldn't be a problem, but a trade line you add now would still be considered new.

I don't know if it's better to have a 2nd 6 month old trade line vs a thin file when you app for a mortgage. In your case you already have a good score and not enough time for a new trade line to mature.. no one to add you to an old account as an AU... I'd just not poke the bear. Pay the one account down to a very small balance at least a month before you app and definitely don't close it.

Hopefully your good payment history and proof of solid income/employment history will do the trick. Are you going FHA or VA or big down payment?


I am a veteran , so I was planning on using the VA loan. Is there any additional info I should know about that, or anything in general?
Thanks you to everyone for the help.

#13 johnnyderp

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Posted 27 February 2012 - 03:03 PM






What is your ten year old account with the $400 balance? I presume that it is a revolving account - what is the credit limit?


It is a credit card. Limit is only $2000. It's with a shitty bank, as I got it when i turned 18. I already asked for them to lower the interest rate and they said all rates are the same for everyone. I want to close it , but it would really screw up my credit score.



Do NOT close that credit card. First, get that balance below $200 or 10% and you might get a few points increase. Second, if you have a relative that has long time credit card accounts, you might ask for them to add you as an authorized user on a couple of them. Make sure that the balance on their cards is low and that it stays there. If going for a mortgage within 6 months, I would suggest that have no new inquiries before you close on your loan. Inquiries could knock a few points each and a new trade line may or may not cost a few points.



Ok, so just hang tight with what I have?
Unfortunately I do not know anyone that I can ask to add me , so I'm sol there.

Would the score drop because of the inquiry or because the age of the new line of credit?


Potentially both, but your score would recover and improve if there's enough time between now and your mortgage app. After 6 months an inq wouldn't be a problem, but a trade line you add now would still be considered new.

I don't know if it's better to have a 2nd 6 month old trade line vs a thin file when you app for a mortgage. In your case you already have a good score and not enough time for a new trade line to mature.. no one to add you to an old account as an AU... I'd just not poke the bear. Pay the one account down to a very small balance at least a month before you app and definitely don't close it.

Hopefully your good payment history and proof of solid income/employment history will do the trick. Are you going FHA or VA or big down payment?


I am a veteran , so I was planning on using the VA loan. Is there any additional info I should know about that, or anything in general?
Thanks you to everyone for the help.


With the VA backing you, you have nothing to worry about. DH had tons of derogs (from before we got married) when we went through this process last year, plus we had high %util back then. At least your report is clean. :-) You'll pay a VA fee but won't need a down payment and still won't have to pay PMI. Oh btw, use the USAA MoversAdvantage service to find a realtor, and they give you free $$ after you close even if you don't finance through USAA.

#14 Repairerer

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Posted 27 February 2012 - 03:05 PM

I think VA is one of those deals where it is one rate for everyone and you either qualify or you don't. You should be pretty good to go, as long as you aren't late on paying back taxes or something.

Johnny has more info, but posted while I was still trying to type on my phone, haha.

Edited by Repairerer, 27 February 2012 - 03:06 PM.


#15 johnnyderp

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Posted 27 February 2012 - 09:07 PM

Holy Jesus, forget what I said about USAA MoversAdvantage... look at this:

Save on Your First Home With First-Time Homebuyer Plus


Plus NFCU will pay up to $2500 of your closing costs.

#16 Filter

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Posted 27 February 2012 - 09:44 PM

Holy Jesus, forget what I said about USAA MoversAdvantage... look at this:

Save on Your First Home With First-Time Homebuyer Plus


Plus NFCU will pay up to $2500 of your closing costs.


I was not in the Navy, but am a veteran, would I still qualify to use NFCU?

#17 Filter

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Posted 27 February 2012 - 09:46 PM

One more question. I was just thinking this over and I remembered that I have a card at a jewelery store that is over about 8 years old, but technically closed because I haven't used it in 5 years.
If I reused it would it help my score? Or would it hurt?
Would they have to do an inquiry if I use it again?

Thanks in advance.

#18 johnnyderp

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Posted 27 February 2012 - 09:47 PM


Holy Jesus, forget what I said about USAA MoversAdvantage... look at this:

Save on Your First Home With First-Time Homebuyer Plus


Plus NFCU will pay up to $2500 of your closing costs.


I was not in the Navy, but am a veteran, would I still qualify to use NFCU?


You don't have to be Navy, but you did need to have retired from the military, otherwise you need an eligible family member.

How to Become a Member


#19 johnnyderp

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Posted 27 February 2012 - 09:51 PM

One more question. I was just thinking this over and I remembered that I have a card at a jewelery store that is over about 8 years old, but technically closed because I haven't used it in 5 years.
If I reused it would it help my score? Or would it hurt?
Would they have to do an inquiry if I use it again?

Thanks in advance.


You could call and ask but I wouldn't waste the inquiry unless they agreed to reopen the same account with the same history rather than make you apply for a new account. If it's still on your report, your AAoA is benefiting from it anyway, and if you wouldn't use it to buy jewelry in the future they'd just close it again. Prob not worth the trouble.

#20 Filter

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Posted 09 March 2012 - 11:50 AM

Ok , my situation just totally changed. My living situation is changing and it looks like I am going to have to sign a 1 year lease. Given that time, it looks like I'll be buying in a year instead. SHould I now try and open a new card?

#21 Jaymes

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Posted 09 March 2012 - 12:26 PM

Absolutely, join NFCU.

I agree with most of the advice above, but if you're not planning a home purchase within six months, I definitely would open a new credit account (I would open it at NFCU).

I believe you will get a score increase immediately because of your improved UTIL, but even if it's not immediate, you definitely will see an increase in a couple of months. Once you open your NFCU card, balance transfer the $400 from your current card to your new card... as NFCU has 0% BT through, I believe, the end of this month.

Generally, going forward, you only want a balance to report on no more than half of your current revolving accounts (in your case, that would mean a balance on only ONE card).

#22 Filter

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Posted 09 March 2012 - 04:48 PM

Absolutely, join NFCU.

I agree with most of the advice above, but if you're not planning a home purchase within six months, I definitely would open a new credit account (I would open it at NFCU).

I believe you will get a score increase immediately because of your improved UTIL, but even if it's not immediate, you definitely will see an increase in a couple of months. Once you open your NFCU card, balance transfer the $400 from your current card to your new card... as NFCU has 0% BT through, I believe, the end of this month.

Generally, going forward, you only want a balance to report on no more than half of your current revolving accounts (in your case, that would mean a balance on only ONE card).



I can't join NFCU, Although I was in the military I only did my 4 years. If I understand correctly you have to have retired from the military to join.
Any other card suggestions?

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Posted 10 March 2012 - 12:13 PM

????

#24 ICANHASMUNY?

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Posted 10 March 2012 - 12:45 PM

Some very old fashioned advice -

Mortgage Lenders don't only look at scores to judge credit risks.

the facts on the ground are;

1) you've only had one card, and you've always paid it on time, and never defaulted.

2) you've had car loans in the past, and these were paid, no repossesions or judgments on your report.

3) your credit file is thin, but it is solid, and you have managed your money wisely.

4) you haven't applied for any new credit, but decided to save your money for a house.

5) you were in the miltiary

this is all great stuff. - you've shown you can manage your bills and your lifestyle doesn't involve living off credit cards, and buying stuff you can't afford with cash in hand.

If i was a mortgage lender, you would qualify for a mortgage within your income, and I would never worry about it.

for your first home, buy something affordable - as in Payments within 25- 30% of your monthly income. - not what the realtors and lenders state you can afford.

The realtors always want to sell you the highest you can afford so they make more in fees.

& stash away as much $$ as you can - owning a house isn't just making the payments, it's keeping up with all the repairs and maintenance.

#25 Duck Bills

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Posted 10 March 2012 - 12:49 PM


Absolutely, join NFCU.

I agree with most of the advice above, but if you're not planning a home purchase within six months, I definitely would open a new credit account (I would open it at NFCU).

I believe you will get a score increase immediately because of your improved UTIL, but even if it's not immediate, you definitely will see an increase in a couple of months. Once you open your NFCU card, balance transfer the $400 from your current card to your new card... as NFCU has 0% BT through, I believe, the end of this month.

Generally, going forward, you only want a balance to report on no more than half of your current revolving accounts (in your case, that would mean a balance on only ONE card).



I can't join NFCU, Although I was in the military I only did my 4 years. If I understand correctly you have to have retired from the military to join.
Any other card suggestions?




Join USAA. If you did your four years and were honorably discharged you can join.




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