Comments on: 10 Facts About Credit Scores and Credit Reports http://theadventurouswriter.com/blog/10-facts-about-credit-scores-reports/ Got goals? Need a push in the right direction? You've come to the right place! Tue, 22 May 2012 22:32:14 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: Charlene McNary http://theadventurouswriter.com/blog/10-facts-about-credit-scores-reports/comment-page-1/#comment-4445 Charlene McNary Fri, 29 May 2009 20:54:17 +0000 http://theadventurouswriter.com/blog/?p=1425#comment-4445 A few things to consider: 1) Credit scores are critical for more than obtaining credit. Many companies: auto insurance, home insurance, alarm system providers, etc are increasingly using credit scores as a component in their pricing for their services. Many people do not realize it but a low credit score or no credit score can disqualify you from receiving some of the incentives frequently promoted by alarm companies and cable companies. 2) Closing accounts does not only impact your credit available ratio but also the component of your score determined by how long you've had credit. Close the credit card you've had the longest and you can see your score take a dive. Credit scores are meant to indicate how well you MANAGE debt not how well you stay out of debt. A few things to consider:

1) Credit scores are critical for more than obtaining credit. Many companies: auto insurance, home insurance, alarm system providers, etc are increasingly using credit scores as a component in their pricing for their services. Many people do not realize it but a low credit score or no credit score can disqualify you from receiving some of the incentives frequently promoted by alarm companies and cable companies.

2) Closing accounts does not only impact your credit available ratio but also the component of your score determined by how long you’ve had credit. Close the credit card you’ve had the longest and you can see your score take a dive.

Credit scores are meant to indicate how well you MANAGE debt not how well you stay out of debt.

]]> By: Ethan Ewing http://theadventurouswriter.com/blog/10-facts-about-credit-scores-reports/comment-page-1/#comment-4430 Ethan Ewing Thu, 28 May 2009 16:52:50 +0000 http://theadventurouswriter.com/blog/?p=1425#comment-4430 Duane, what I meant by leaving accounts open is that if you have a certain amount of debt outstanding, closing some of the cards may increase your available credit to debt ratio, the lower this number, the better for you. If you do not have any outstanding debt, then this would not apply to you. A big part of your FICO credit score (about 30%) is determined by the ratio of how much you owe to how much credit you have available. The lower the ratio, the higher your score. The more you have available and unused, the lower your ratio will be. Apparently, it is a good sign if you can responsibly handle a high credit limit. The purpose of a credit score is to gauge your ability to repay the money that is lent to you. If you do not need any credit, then you need not bother about your score. You can read more about credit and credit scores at http://www.bills.com/credit/. Duane, what I meant by leaving accounts open is that if you have a certain amount of debt outstanding, closing some of the cards may increase your available credit to debt ratio, the lower this number, the better for you. If you do not have any outstanding debt, then this would not apply to you.

A big part of your FICO credit score (about 30%) is determined by the ratio of how much you owe to how much credit you have available. The lower the ratio, the higher your score. The more you have available and unused, the lower your ratio will be. Apparently, it is a good sign if you can responsibly handle a high credit limit.

The purpose of a credit score is to gauge your ability to repay the money that is lent to you. If you do not need any credit, then you need not bother about your score. You can read more about credit and credit scores at http://www.bills.com/credit/.

]]> By: Danny Kofke http://theadventurouswriter.com/blog/10-facts-about-credit-scores-reports/comment-page-1/#comment-4418 Danny Kofke Wed, 27 May 2009 22:46:03 +0000 http://theadventurouswriter.com/blog/?p=1425#comment-4418 Hi Duane, I agree with you but it is true that using cash can lower your credit scores. Here is link to a site about FICO scores: http://financialplan.about.com/cs/creditdebt/a/FICOCreditScore.htm 30% of your FICO score is based on the amount you currently owe lenders so, if you do not have any debt and only use cash, your FICO score will be affected. Even though it will hurt your score, I think being debt-free is the way to go. If you don't owe anyone anything, who cares what your credit score is? In addition, if you use cash to pay for your purchases and do not need a loan it really does not matter what your FICO says. Hi Duane,

I agree with you but it is true that using cash can lower your credit scores. Here is link to a site about FICO scores:
http://financialplan.about.com/cs/creditdebt/a/FICOCreditScore.htm

30% of your FICO score is based on the amount you currently owe lenders so, if you do not have any debt and only use cash, your FICO score will be affected.

Even though it will hurt your score, I think being debt-free is the way to go. If you don’t owe anyone anything, who cares what your credit score is? In addition, if you use cash to pay for your purchases and do not need a loan it really does not matter what your FICO says.

]]> By: Shane http://theadventurouswriter.com/blog/10-facts-about-credit-scores-reports/comment-page-1/#comment-4140 Shane Thu, 14 May 2009 04:19:07 +0000 http://theadventurouswriter.com/blog/?p=1425#comment-4140 Nice post... Thanks, Shane G. Nice post…

Thanks,

Shane G.

]]> By: Laurie Pawlik-Kienlen http://theadventurouswriter.com/blog/10-facts-about-credit-scores-reports/comment-page-1/#comment-4137 Laurie Pawlik-Kienlen Wed, 13 May 2009 22:50:07 +0000 http://theadventurouswriter.com/blog/?p=1425#comment-4137 Duane, thanks for your question -- and Bruce, thanks for your comment. The question about credit cards is beyond my knowledge about credit scores, so I've asked the experts at Bills.com to reply....I'm having a problem with my comment function (they're not all posting, grrrr!!), so there might be a slight delay. Sorry about that, and hang in there.... Laurie Duane, thanks for your question — and Bruce, thanks for your comment.

The question about credit cards is beyond my knowledge about credit scores, so I’ve asked the experts at Bills.com to reply….I’m having a problem with my comment function (they’re not all posting, grrrr!!), so there might be a slight delay. Sorry about that, and hang in there….

Laurie

]]> By: Bruce http://theadventurouswriter.com/blog/10-facts-about-credit-scores-reports/comment-page-1/#comment-4130 Bruce Wed, 13 May 2009 17:17:46 +0000 http://theadventurouswriter.com/blog/?p=1425#comment-4130 Your credit rating is based on the credit you use. If you never take a loan and don't use credit cards there is a very limited amount of information available to show your ability to handle credit. Your credit rating is based on the credit you use. If you never take a loan and don’t use credit cards there is a very limited amount of information available to show your ability to handle credit.

]]> By: duane wandel http://theadventurouswriter.com/blog/10-facts-about-credit-scores-reports/comment-page-1/#comment-4098 duane wandel Mon, 11 May 2009 16:00:11 +0000 http://theadventurouswriter.com/blog/?p=1425#comment-4098 My wife and I do not owe on our credit cards, they are always paid when they come do.But the cards we no longer use, your suggesting leaving the accounts open instead of closing them? How bad could that really effect someone who has the ability to pay cash as they go? Fico scores should be based on a persons ability to stay out of dept not just how well they did to pay their dept down. Are you suggesting that if we cancelled all credit cards that we would not be able to go to a bank and ever borrow even if we are dept free? I think that would be rediculous for banking institutes to do business that way. Thank You for your time My wife and I do not owe on our credit cards, they are always paid when they come do.But the cards we no longer use, your suggesting leaving the accounts open instead of closing them? How bad could that really effect someone who has the ability to pay cash as they go? Fico scores should be based on a persons ability to stay out of dept not just how well they did to pay their dept down. Are you suggesting that if we cancelled all credit cards that we would not be able to go to a bank and ever borrow even if we are dept free? I think that would be rediculous for banking institutes to do business that way. Thank You for your time

]]>