The Armchair Real Estate Millionaire by Michael Dominguez

Author:Michael Dominguez
Language: eng
Format: epub
Publisher: Bazinga Publishing
Published: 2021-01-15T00:00:00+00:00

Insider Tip: Improve Your credit score

If you are creating a credit history or are looking to improve your credit score, consider adding a credit card where you have to provide the lender with a deposit equal to your credit limit. Make sure that you make each payment. Two different credit cards like that with six to12 months of payment history will turn your credit score around in a hurry.

Lowering your credit limit can HURT your credit score. In fact, if you have a balance on a credit card or home equity line of credit, inquire to see if they will raise the limit. If the credit card has a $10,000 limit and a balance of $8,000, this will work against your credit score. If the lender is willing to increase your limit to $20,000, the $8,000 balance is now well under 50 percent of the balance and as long as you are making your payments, it is a good thing. The used credit versus available credit category represents 30 percent of the entire credit score, so it’s a big deal.

Thoroughly look through your credit report for old credit cards that are still active. A $100 balance on your Home Depot card from 2015, now in collections, can greatly affect your score. If there are credit cards out there that are still active that you completely forgot about, consider getting rid of them. Although unlikely, if your identity is ever compromised, you might never know about that Brick, Target, or Costco credit card from years ago.

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