55

A person's credit score is related to their risk of defaulting on a loan. When evaluating if your scoring model is any good, though, you can't evaluate the likelihood of default from one person, since every borrower either does or does not default. In order to calibrate a credit score model, you need to aggregate data from many individuals to determine ...


38

Option D: Pay bills using credit card. Wait for billing period to close and monthly statement to be generated. Pay the statement balance in full, and pay it on or before the due date. For credit card reward points, simply using your card earns the points, regardless of when or how frequently you pay the card. For credit score, actually making your payments, ...


27

I'm totally unfamiliar with car leasing, which I thought might be a more affordable and suitable option right now Leases aren't an "affordable" way to get a car. They're a way to get an expensive car that you can't afford to buy outright. It's effectively renting a car, so you have nothing to show for it after the lease is up. I would not ...


25

Increasing the number of cards is a double-edged sword credit-wise. There's a trade-off between the amount of credit used (utilization), number of inquiries and open accounts (fewer is generally better) and average length of credit (churning accounts means a shorter average). The main factor in your credit score is a good payment history. From what I've seen ...


24

Credit scores are not completely transparent, but when I look at my score there's no mention of the magnitude of any events. Truthfully I have no bad events but the only indication is a count (0), not any indication of size. A bad event is a bad event. It doesn't matter if it's a $10 default or a $10,000 default - it gets reported the same way from what I ...


21

I want to know will this has a bad effect on my credit, etc? Closing a checking and/or savings account should have zero impact on your credit score. There is a risk if you close the account, and you have written a check and it hasn't been cashed yet. If that was to result in a bounced check or a debt to the bank that could impact your credit history. Also ...


20

Just open another bank account with a different institution. Walk in, sit down, leave with a new bank account and routing number. (You may be able to do this online with some institutions, but either way you need to fund the new account with some money you already have.) Connect it to your brokerage account. Initiate a transfer of money that covers the ...


18

The credit score is an evaluation of your credit history. It doesn't know how much you make. It looks at how much of your available credit you use. It looks at how long you have had credit lines. It looks at the number of on-time and late payments. If you have a very bad score lenders will either refuse your loan application, or they will charge a higher ...


17

Neither paycheck deposits or rent are factored into your credit score. Only lines of credit. If you don't close the credit cards and you use them at least once in a while, then pay off the bill on time your credit should be fine. Can you not use the credit card for an occasional lunch or small purchase it the country you will be staying in? Not having ...


17

I've paid off my mortgage and never carry a balance on a credit card and my credit score is 818 (excellent). Banks don't publicly disclose how exactly a credit score is calculated, so it's hard to predict anything with certainty but, chances are you will be just fine with paying off your mortgage and credit card balances. Close the credit cards that you are ...


16

It only makes sense to make mid-period payments on credit cards when you need to free up available credit for a large purchase or are needing to keep utilization low due to incoming credit pulls for a loan (both to juice your credit score and to minimize debt to income ratio). Paying your statement balance each month lets you earn some trivial interest on ...


14

some old affordable car, say a 2008-2010 Nissan or Hyundai with at least 100k miles mileage" A Japanese* car of that vintage is not old, and 100K miles is just nicely broken in**. You would do better to look at say 5 years or so either side of 2000. Check out your local Craigslist. * I have no experience with Korean makes, but don't see why they ...


12

Because if I were to pay off all my cards, and never borrow again, everything would age off in a few years and my excellent credit would disappear. Credit cards stay in your credit file as long as they are active. To keep them active use them and pay the balance off before you are charged any interest. It doesn't take much usage to keep them alive. Use one ...


9

First of all, I'm not convinced that your credit score is a "percentage" (percentage of what?) Credit scores in the UA have maximums as well ,but they are less that 999 (and different depending on the provider). So I don't see how it can be translated as a "percentage". But as for the rest of the argument - a credit score is a measure ...


9

The "Personal Finance" answer to this is (relatively) simple. As Hart CO says in a comment, report her. What she is doing is fraud against you, your siblings, and whoever else is caught up in this - like "your" sub-let tenant at the rented property. But more realistic might be something of an "Interpersonal Skills" answer... ...


7

Treating 30% of utilization as a rule to be followed is dumb. It is a natural consequence of using a credit card correctly, not something to do for its own sake. The right way to use a credit card is to buy the things you were going to buy anyway (assuming there isn't an extra charge for using a credit card), then pay the statement balance in full on or ...


7

I believe this is similar to an XY question. Since you own your home, don't have debt, likely aren't applying for a new job, and don't need to borrow money, your credit score probably is irrelevant and not worth a moment's thought or your valuable energy. There is virtually no need to worry about your credit score if you are never going to need to borrow ...


6

Option C: Pay bills using credit card. Wait until almost the end of the billing cycle, then do a lump sum payment of all bills for the month. This one. Make sure you set you credit card to "auto-pay". That makes sure it gets paid on time, maximizes the time you can hold on to your money, and you can't screw it up (which is an expensive mistake). ...


6

I have a FICO 8 score that is fluctuating from 810-830 and the only reason code given is: Proportion of loan balances to loan amounts is too high If that message is the only one you have, and the score you have is more than 800 you have nothing to worry about. The score and message will not stop you from getting other loans or credit cards. The mortgage is ...


6

Are there any differences between reports of secured and unsecured credit cards and their effect on my credit history/score? No. The secured/unsecured status of your card is not reported to the bureaus. If I upgrade my secured cards to unsecured, does it have any negative or positive effect on my history/score? As the bureaus don't know if the card is ...


6

I don't know how detailed the reports are that you get, but there are factors that can change daily that can swing your score slightly. The average age of your credit accounts is one factor that can change daily. I have also seen anecdotal reports (most credit score algorithms are "black-box" to reduce gaming the system) that a 0% utilization on an ...


5

ANY unpaid debt is negative for your credit. That being said, there are so many different scoring models, even by the same bureau, that it's virtually impossible to assess the consequences. Some might place more emphasis on small unpaid debts relative to larger ones, others may look at installment debt default as more serious than auto debt default or ...


5

"Credit Scores" are an over-simplification of the UK system, so it's worth understanding what happens behind the scenes. We have four credit reference agencies, Equifax, Experian, TransUnion and Crediva. Each agency collects information about you, and sells that information to companies that may be considering offering you credit. The company then ...


5

Credit score in the U.S. is based on the information in your credit report. One of the factors of your credit score is credit utilization, which is a function of your credit card balances and your available credit. These balances are reported monthly to your credit report by your credit card company. However, there are a few reasons why trying to maximize ...


5

Age of accounts, the mix of credit types (revolving, installment, auto, mortgage), utilization rate and payment history are the key metrics of a credit score. If you're using 30% or more of your TOTAL available credit then that hurts your score until you pay it down below 30%. Every time you add a new card, the average age of accounts declines and affects ...


5

Buy used, from an individual seller not a dealer, aiming for a $1000-3000 price tag, and pay cash up front. The examples you mentioned in your question: some old affordable car, say a 2008-2010 Nissan or Hyundai with at least 100k miles mileage. are perfectly good choices, but you might find a Honda or Toyota better. Nissans tend to be more expensive to ...


5

The question seems to reflect a misconception that a credit score is intended to reflect the amount that can be safely lent to someone. Rather, it is intended to reflect the likelihood of repayment for a loan of a given size relative to the borrower's income. It is natural to have an upper limit, which would correspond to (nearly) 100% likelihood of ...


5

Part of the story here is that Wells Fargo is subject to a $1.95T asset cap (from the Fed following on that 2016 account opening scandal). They have to be choosy about assets as they sit right at that cap ($1.945996T on their last 10-Q). Those personal loans were on their books as assets. The cap means that they are motivated to "free up space" for ...


5

Credit utilization is, mostly, point in time: how much do you owe, right now. So unless you plan to take a major loan soon (probably not if you're a young student and have only a $500 limit), it doesn't really matter what happens to your credit utilization: from the credit score point of view, this is a neutral to slightly positive thing overall (if you ...


4

According to my experience, no amount will fix your issue. Note that the exact calculation of Fico scores is not public, so anything is a guess. Your mortgage gets reported with the current total outstanding, and the max the same number; i.e., it is always a '100% used loan'. That will not change, even if you pay it down to $1 - it will be a $1 loan that is ...


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