Credit Tips To Live By
Homeownership begins with good credit. Here are some tips to help get you on the right path.
- PAY YOUR BILLS ON TIME! A large part of your FICO Score is determined by your bill payment history.
- Transfer high interest credit card balance to lower or 0% interest cards. This will have no affect on your FICO score but it will have a big affect on saving money.
- Pay all your credit cards down to 40% or less of your limit. Ex. If your limit is $1,000 then always keep your balance at $0- $400.
- Trim your credit cards down to 1 of each major credit card (Visa, MasterCard, Amex) Excessive amounts of credit cards are not necessary.
- If you have several credit cards and have PAID the balances, it is not always necessary to close them out. Leave them open. Just do not use them. If the temptation is too great then cut them up. But leave them open. By doing so, you are leaving a card with good standing history on your credit file (zero balance). That is a good thing!
- Monitor your credit limits on all credit cards. Sometimes credit cards will automatically increase your limit. If you are disciplined enough to maintain good spending habits, (the 40% or less rule) let them continue to increase your limit! They are trying to entice you to spend more money. Your credit will not be affected negatively by the increase. If anything, it will just say to other potential creditors that you are more credit worthy. But remember…DISCIPLINE!!!!!
- Call all credit card companies if you are having difficulty paying. Many times they will work with you by moving your due dates.
- Call and ask for a lower percentage rate on all your credit cards. If you are in good standing, most companies will consider lowering your credit. If they refuse, ask what you need to do in order to receive the reduction in the future.
- THE GOLDEN RULE – Be real with yourself! If you really can’t afford something, don’t charge it! AND don’t charge things that you can afford to pay cash for!
