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Donal DeLay
07-05-2007, 02:54 PM
Okay, as some of you know, my wife and I moved in with my in-laws to clean up our debt. And by OUR debt I mean MY debt. Since moving out on our own, all the bills etc. have been under MY name.

JUST this year my wife got her first credit card with a 300.00 limit.

Now, 90% of our/my debt is cleared. We have one morepayment to make to the IRS then it's just automated payments to wipe out my credit card.

So, after that last IRS payment, my wife and I are looking for ways to increase her credit and keep it at good standings. We've never missed a payment on her card, and it's never gone over the limit.

Aside from a car, what are some ways we can establish good credit for her? Or is it enough that she has a credit card and a storage facility in her name, both of which are always paid on time.

Jacob Lyon Goddard
07-05-2007, 03:00 PM
get a loan
then pay it back
immediately

kari
07-05-2007, 03:02 PM
The Credit Card will do wonders.

Kingsumo
07-05-2007, 03:04 PM
get a loan
then pay it back
immediately

This!

Or a varient, as you already have the credit card would be to use it to make mid to small purchases and then pay it off within the same month.

this has the effect of showing usage on the card as well as showing you can keep it payed off, also if you pay it within the same month, with most companies you will not even get charged interest.

Skatonic10
07-05-2007, 03:46 PM
get another credit card and use it only to pay for gas. It keeps the bill on that card low and easy to pay off each month. That will help

KarlH
07-05-2007, 03:50 PM
Generally installment loans (car, motorcycle, boat etc) are the best for raising your credit, next to a mortgage. Revolving debt helps but not as much as an installment loan. Just opening and closing it will help a bit but credit is all about consistency. Every 6 months you can request a credit increase, they will pull your credit for this so keep this at a minimum. That goes for all credit inquiries. Also, don't change cards that often, length of time matters. Close all open accounts that you don't use, credit companies look at your ability to run up all your open accounts, not just what you use.

JoeE
07-05-2007, 04:01 PM
I put a $600 TV on my card with the full intent of paying for it when it was due to build credit, and I was rewarded with a 50 point drop in my credit score two weeks before the period end. I'm thinking about contesting it.

Be careful with credit-building activities.

Albert
07-05-2007, 04:04 PM
I don't even know how to check your credit score!

Frozen Sooner
07-05-2007, 04:08 PM
I put a $600 TV on my card with the full intent of paying for it when it was due to build credit, and I was rewarded with a 50 point drop in my credit score two weeks before the period end. I'm thinking about contesting it.

Be careful with credit-building activities.

What do you think you'd be contesting? Was the information contained on the report inaccurate? The score is based on an algorithm that takes into account the information on your credit report-if the information is accurate, then the score isn't really contestable. The scoring systems are validated pretty frequently to make sure they're good actuarial predictors of default.

Likely (if this is the extent of your credit activities) that the drop was caused by your increased ratio of used credit to available credit-you'll get the 50 points back as soon as you pay off the TV, plus some for a few more months of positive pay history. That, of course, is if you put the purchase on a bank credit card as opposed to a department store or finance company card, which will lower your credit score.

Jamie Howdeshell
07-05-2007, 04:09 PM
get a loan
then pay it back
immediately

According to Clark Howard (a consumer advocate) games like this do very little to help your credit and aren't worth the hassle.

Don't do it.

Look around Howard's site to get some good info on building good credit.

www.clarkhoward.com

JoeE
07-05-2007, 05:57 PM
What do you think you'd be contesting? Was the information contained on the report inaccurate? The score is based on an algorithm that takes into account the information on your credit report-if the information is accurate, then the score isn't really contestable. The scoring systems are validated pretty frequently to make sure they're good actuarial predictors of default.

Likely (if this is the extent of your credit activities) that the drop was caused by your increased ratio of used credit to available credit-you'll get the 50 points back as soon as you pay off the TV, plus some for a few more months of positive pay history. That, of course, is if you put the purchase on a bank credit card as opposed to a department store or finance company card, which will lower your credit score.

The thing is, though, they knocked off the points during the grace period, which I didn't think they could do. I didn't carry an interest-bearing balance at all. I immediately paid it off when I got the alert.

sumopanda
07-05-2007, 06:19 PM
On this subject, where is a good place to actually CHECK your credit standing? How does one do that? I tried one of those places online that has "Free credit reports" but they wanted a credit card number before I could continue on (so much for free), and seeing as I have no credit card anyways, it was pointless.

RickLM
07-05-2007, 06:37 PM
According to Clark Howard (a consumer advocate) games like this do very little to help your credit and aren't worth the hassle.

Don't do it.

Look around Howard's site to get some good info on building good credit.

www.clarkhoward.com




I've heard the same thing. The old advice of getting a loan, then paying it off quickly to obtain a good credit score is a bit of a myth.

Check the above website, or check Dave Ramsay's site.

After you get your debts paid off (and congrats!), your next goal is to build up a savings account of 3-6 months living expenses. This may or may not impact your credit score but it is very sensible and it improves your net worth.

Keith P.
07-05-2007, 06:42 PM
A credit card will work WONDERS for your credit.

This is the key. Never, ever, ever, carry more than a 30% balance. 30% is the magic number that the credit reporting agencies use in the scoring system. It maxmizes your gains.

So, your wife has a $300 limit. That means never charge more than $90. NEVER have any lates. Use if every single month, the account needs regular activity, and pay the balance in full each month.

Do not pay off installment loans, car payments, etc early. One of the most common misconceptions on credit is that paying off a loan early will improve your score. It will not. It can however, harm your score, as you are not abiding by the original terms of the loan agreement.

Paying off a judgement will neither harm, nor improve your score. The damage to your score has been done once the judgement has been reported to the agencies. Pay them off anyway. Having an unpaid judgement on your report is often one of the things that will prevent credit from being extended to you.

Paying off a collection can harm your score. Which is incredibly retarded, but there you go. Basically, it registers as activity on a past due account and the credit reporting agencies can ding you, because it is not an active account. If you pay a collection, pay it in full, if you can.

DO NOT CLOSE OUT ACCOUNTS.

Many people have this idea that its a good idea to pay an account such as a credit card off, and then close it out. The more active accounts you have, with low, or zero balances, the better. Every active tradeline you have with a low balance increases your score, especially "seasoned" accounts, that are 1 year or more old.

Frozen Sooner
07-05-2007, 06:43 PM
The thing is, though, they knocked off the points during the grace period, which I didn't think they could do. I didn't carry an interest-bearing balance at all. I immediately paid it off when I got the alert.

You're confusing an algorithm-a mathematical formula-with nefarious individuals who are attempting to screw up your credit.

The credit card company transmits your balance, available credit, and pay history once a month. If you happened to have a balance-whether within the grace period or not-it got reported. If that ate up a big chunk of your available credit limit, then it very well could have knocked your score down 50 points, because the algorithm has your ratio of revolving debt to available credit limit as a component. From what the people at Experian have told me, it's one of the heavier-weighted items. Like I said, though-pay it off and you get the points back the next month.

Frozen Sooner
07-05-2007, 06:46 PM
A credit card will work WONDERS for your credit.

This is the key. Never, ever, ever, carry more than a 30% balance. 30% is the magic number that the credit reporting agencies use in the scoring system. It maxmizes your gains.

So, your wife has a $300 limit. That means never charge more than $90. NEVER have any lates. Use if every single month, the account needs regular activity, and pay the balance in full each month.

Do not pay off installment loans, car payments, etc early. One of the most common misconceptions on credit is that paying off a loan early will improve your score. It will not. It can however, harm your score, as yo uarenot abiding by the original terms of the loan agreement.

Paying off a judgement will neither harm, nor improve your score. The damage to your score has been done once the judgement has been reported to the agencies. Pay them off anyway. Having an unpaid judgement on your report is often one of the things that will prevent credit from being extended to you.

Paying off a collection can harm your score. Which is incredibly retarded, but there you go. Basically, it registers as activity on a past due account and the credit reporting agencies can ding you, because it is not an active account. If you pay a collection, pay it in full, if you can.

DO NOT CLOSE OUT ACCOUNTS.

Many people have this idea that its a good idea to pay an account such as a credit card off, and then close it out. The more active accounts you have, with low, or zero balances, the better. Every active tradeline you have with a low balance increases your score, especially "seasoned" accounts, that are 1 year or more old.


Everything you've written is on the nose so far as I know but the bolded part.

Every loan contract written has a prepayment provision, so yes, prepayment is abiding by the terms of the agreement. No, it does not harm your score to prepay. HOWEVER, opening multiple accounts and paying them off quickly does harm your score as you'll get dinged for multiple account openings in a short period of time.

Keith P.
07-05-2007, 06:49 PM
Everything you've written is on the nose so far as I know but the bolded part.

Every loan contract written has a prepayment provision, so yes, prepayment is abiding by the terms of the agreement. No, it does not harm your score to prepay. HOWEVER, opening multiple accounts and paying them off quickly does harm your score as you'll get dinged for multiple account openings in a short period of time.

I've been told by every single underwriter that pre-payment of an installment loan can damage your score if the creditor chooses to report it as such, depending on the wording of the pre-payment provision.

Frozen Sooner
07-05-2007, 06:53 PM
I've been told by every single underwriter that pre-payment of an installment loan can damage your score if the creditor chooses to report it as such, depending on the wording of the pre-payment provision.

I've spoken directly with the people who build custom scoring models for Experian and they've never mentioned anything like that. I look at raw credit reports every day of my work life and I've never seen a pre-paid account reported as anything but "Paid as agreed."

Now, the Fair Isaac model uses something like 500 variables, so they may not have mentioned it to me, but I'd have a really hard time believing that there's an actual correlation between propensity to repay debt quickly and delinquency-and the model builders would have to statistically validate that correlation annually under ECOA.

JoeE
07-05-2007, 06:58 PM
You're confusing an algorithm-a mathematical formula-with nefarious individuals who are attempting to screw up your credit.

The credit card company transmits your balance, available credit, and pay history once a month. If you happened to have a balance-whether within the grace period or not-it got reported. If that ate up a big chunk of your available credit limit, then it very well could have knocked your score down 50 points, because the algorithm has your ratio of revolving debt to available credit limit as a component. From what the people at Experian have told me, it's one of the heavier-weighted items. Like I said, though-pay it off and you get the points back the next month.

Yeah, no shit, it's like over 30% of your score. I paid it back, I'm just really impatient with my credit score.

Shane W
07-05-2007, 07:04 PM
A credit card will work WONDERS for your credit.

This is the key. Never, ever, ever, carry more than a 30% balance. 30% is the magic number that the credit reporting agencies use in the scoring system. It maxmizes your gains.

So, your wife has a $300 limit. That means never charge more than $90. NEVER have any lates. Use if every single month, the account needs regular activity, and pay the balance in full each month.

Do not pay off installment loans, car payments, etc early. One of the most common misconceptions on credit is that paying off a loan early will improve your score. It will not. It can however, harm your score, as you are not abiding by the original terms of the loan agreement.

Paying off a judgement will neither harm, nor improve your score. The damage to your score has been done once the judgement has been reported to the agencies. Pay them off anyway. Having an unpaid judgement on your report is often one of the things that will prevent credit from being extended to you.

Paying off a collection can harm your score. Which is incredibly retarded, but there you go. Basically, it registers as activity on a past due account and the credit reporting agencies can ding you, because it is not an active account. If you pay a collection, pay it in full, if you can.

DO NOT CLOSE OUT ACCOUNTS.

Many people have this idea that its a good idea to pay an account such as a credit card off, and then close it out. The more active accounts you have, with low, or zero balances, the better. Every active tradeline you have with a low balance increases your score, especially "seasoned" accounts, that are 1 year or more old.


This is pretty spot on. I have several cards open with a very large available credit. My score has jumped to the low 800s since I started opening lines for their "rewards" and then never using them.

Obiwan
07-05-2007, 07:54 PM
You can get a free copy of your credit report here:

https://www.annualcreditreport.com/cra/index.jsp (https://www.annualcreditreport.com/cra/index.jsp)

It is a site set up the the big 3 agencies. Federal law allows you to get one copy a year from each of the big 3. You should get one every 4 months from one of them. That will allow you to track your credit score. They should be the same but there might be some differences, so save the copies and contest anything that might be wrong.

Donal DeLay
07-05-2007, 11:23 PM
A credit card will work WONDERS for your credit.

This is the key. Never, ever, ever, carry more than a 30% balance. 30% is the magic number that the credit reporting agencies use in the scoring system. It maxmizes your gains.

So, your wife has a $300 limit. That means never charge more than $90. NEVER have any lates. Use if every single month, the account needs regular activity, and pay the balance in full each month.

Do not pay off installment loans, car payments, etc early. One of the most common misconceptions on credit is that paying off a loan early will improve your score. It will not. It can however, harm your score, as you are not abiding by the original terms of the loan agreement.

Paying off a judgement will neither harm, nor improve your score. The damage to your score has been done once the judgement has been reported to the agencies. Pay them off anyway. Having an unpaid judgement on your report is often one of the things that will prevent credit from being extended to you.

Paying off a collection can harm your score. Which is incredibly retarded, but there you go. Basically, it registers as activity on a past due account and the credit reporting agencies can ding you, because it is not an active account. If you pay a collection, pay it in full, if you can.

DO NOT CLOSE OUT ACCOUNTS.

Many people have this idea that its a good idea to pay an account such as a credit card off, and then close it out. The more active accounts you have, with low, or zero balances, the better. Every active tradeline you have with a low balance increases your score, especially "seasoned" accounts, that are 1 year or more old.

My wife has had her card for - I think - 5 months. Should she get another one? I want to increase her credit score any way possible but I want to be SMART about it, since I was a total fuck-up on mine. She's getting "pre-approved" offers damn near every 2 weeks, but we just throw them away because she/we really doesn't want more than one card for fear we might end up in this situation again.

Also, because I screwed myself so bad on my credit card, my credit is completely fucked over, and once I've finally paid off the IRS I'm going to try and work on re-building MY credit.

I had a Cap. 1 card and a BOA card. The CO card debt actually went to a collection agency, and has been paid off now for a couple months. But my BOA card has always been through them. Yeah, late payments and lower-tha-minimum payments got me to where I am, but now I've got automated payments of 200.00 being taken out every 2 weeks for the rest of the year and 3 months into next year.

My question is, the BOA card expired as of Oct. last year. Is it possible to have the account re-opened and activated once enough payments have been taken out that it's below the limit? (it had a 5k limit, and by the end of this year I'll have all but 2300.00 paid off)

I was planning on waiting until the end of the year to even call and ask them that, but if someone here knows, that'll help.

Beep Beep!
07-05-2007, 11:29 PM
You can get a free copy of your credit report here:

https://www.annualcreditreport.com/cra/index.jsp (https://www.annualcreditreport.com/cra/index.jsp)

It is a site set up the the big 3 agencies. Federal law allows you to get one copy a year from each of the big 3. You should get one every 4 months from one of them. That will allow you to track your credit score. They should be the same but there might be some differences, so save the copies and contest anything that might be wrong.But how do you get your CREDIT SCORE without giving somebody your cc number and signing up for something I don't want?

Obiwan
07-06-2007, 01:18 AM
But how do you get your CREDIT SCORE without giving somebody your cc number and signing up for something I don't want?


The websight I mentioned is free. If you want your FICO score it is going to cost you about 8 bucks and they will mail it to you. They are allowed to charge a reasonable fee to send that information to you. Everything else is available online for free. Just tell them your name, address and social security number. Just remember to PRINT EVERYTHING!!! Once you leave that sight, you can't get back into it for free for a year. You can go to one of the other's for free, but not that one. I just went to Equifax through the above website and printed mine out. It actually has something on it that I will have to dispute and have taken off.

Donal DeLay
07-06-2007, 01:29 AM
So, I went to that site, and Equifax couldn'tprovide internet delivery, so from their site fucking up now I have to either pay or wait another year.

And TransUnion asked me to confirm a recent address from their list. I saw 2 on their list, typed in one correct address from their list with the appropriate zipcode and it said it didn't match one of the addresses provided on their list. So I typed in the second correct address from their list, with the appropriate zipcode, and they said the address I typed wasn't on their list.

And because they said both correct addresses on their list were not ones from their list, they couldn't confirm my identity, so now because of their fuck up I have to wait a year or pay.

At least the third site was accurate, and I got to see one of the reports. Wish I could've seen my FICO score, but oh wells.

nihilance
07-06-2007, 04:05 AM
Are you all moving out? When you do split the utilities between the two of your names so you both can establish credit histories. My SO that I've lived with the last 5 years never had any of the utilities and whatnot in her name because I always set them up. But recently we bought a home and two vehicles and both of our names are on all three. Now she gets credit card apps out the ass. We're signing her up for a couple with the intention of always paying the balance right after using them.