I've done a lot of reading recently around improving credit scores here and across the web. There's a lot of info out there, sometimes contradictory, sometimes with varying rates. I understand that scores are calculated differently depending on who's doing it but some clarification on a couple of points would be great.
Context : I have only recently started living in the US (although I'm a US citizen) and I'm trying to get as good a credit score as I can as I'm looking towards buying a house in ~1-2 years time. I will add that credit cards are a totally new concept to me as I've only lived in countries that did without. I currently only have one credit card with a limit of $500. No debt and haven't ever taken up a loan of any sort in the US (only loan I've taken was a student loan abroad which I payed in full without ever defaulting). My current FICO score provided by my bank is 772.
Bellow are a few questions and what my understanding of the correct answers are. Clearing things up and correcting me where I'm wrong would help greatly :
- How often should I use my credit card? I understand it should be every month?
- To what extent? I hear that keeping it between 1-10% is best? and not to go above 30%. So if my card allows for $500 I should not put more than $150 onto it.
- Should I apply for other cards (how many), or apply for a higher limit on my existing card? There isn't much info in regards to how increasing your limit affects your score (or I missed it). I read that too many cards is detrimental, and that 3-ish is a good spot to be. Is this correct? I also understand that I shouldn't apply for several cards at once but a couple of other points still elude me. Namely : 1) Is there any way of knowing if I'm eligible for another card since applying can hurt my credit score? 2) What would be a good time period to wait before applying again, and is raising your limit on existing cards also something that should taken into account here (time wise)?
- Bonus: How much would a 24 month ($4-5k) car loan plan affect my credit? And how long would it take to register? Would it have to be payed in full before a positive report was sent in?
Thanks in advance for your help.