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It stinks because they game you. It usually boosts with a mix of accounts. Car loan, mortgage would typically go here. More debt to get in more debt. Crazy really.
Chief
Additionally you can put all of your spending on a charge card and it lowers your credit utilization which boosts your score
Yeah score is based on now how little debt you have, but how good you are staying in debt without missing payments
Rising Star
If you pay your credit cards on time and have 5+ years of history, should easily be 720+. What’s your length of credit? Opening a couple of new credit cards may help, and try not to use over 20% of the credit limit
Hi, pro tip:
1) Mix of debt has limited bearing on FICO, as weighted at 10% only
2) You don’t need debt to get a good credit score. Only utilize about 30% of your limit. Pay off balance in full if you can as APR is high
3) Do not miss payments. Seems like you missed some in the past.
4) Account age matters. Open couple of no annual fee cards if you want, that would increase your overall limit, reduce utilization, and increase your avg. age of accounts over time.
Would like to re iterate that the low utilization part is very important and often overlooked. I used to only have one card with a fairly low limit. I regularly charged 70-80% of the limit but always paid full statement each month. This somehow really hurt my score. Now I’ve got a bunch of cards with high limits and rarely go over 5-10% utiliz.
Chief
Payment history has the greatest impact on your score. There's nothing you can do to change your previous missed payments, but keep making your payments on time going forward.
As for utilization, you may be able to improve this by asking for a credit line increase on your existing cards. Opening additional accounts helps your average age of credit in the long run, but lowers it in the short term.
Rising Star
These are what I came to day. Increasing an existing credit limit is very easy and useful. Pick your max month usage and go 10X that.
Chief
Average account age is a factor, so if you’re going to open another card I would pick one that has no annual fees, so that you can leave it open forever. Just charge something small and recurring on it (like Spotify membership) to keep it active, and set autopay so you don’t have to think about it.
When does a card become inactive
If you have a car payment and pay that reliably on time that helps. I think having some sort of other credit besides just credit cards like either car loan, mortgage, etc is good.
Give me all your cash in the form of a loan it will help..:)
So, total accounts should be low impact even if yours is under average. There's got to be other factors bringing you down below 700. Payment history, credit card usage and derogatory marks are the highest impact factors. I'd make sure you focus on those to get the score up if you haven't looked at them already
Late payments can stay on a report for up to 7 years and the better your score the more of an impact
Depending on how long ago the missed payments are and from what you could ask the company to remove them. Some will, some won't but the worst they can say is no
The two I use constantly are the Amex Blue Cash Preferred and Chase Amazon Visa. Look those up. You could also grab a hotel-chain specific card.
Own my car already, and no mortgage right now - part of the reason I'm trying to get my credit up is so we can buy a house! I'm 31, and aside from my credit cards, I'm not financing anything really. My payments are mostly on time (missed a couple in the last 5 years due to my auto pay set up malfunctioning). Oldest account is 11 years.
Chief
I’m in the same boat. That’s why I financed my car even though I could have afforded to buy it outright. I was planning for a mortgage and knew it would help boost my score.
Shop around for a few credit cards with good sign up bonuses. Might take a temporary hit for the hard credit inquiries but longer term your lower credit utilization and increase in number of credit accounts will help.
One thing to watch out for is the yearly fees as ideally you want to keep those accounts open long term and not have to keep paying for them.
You can boost your score by adding utility payments to it ( I believe Experian has this feature). My friend from school created an IG account where he posts tips for personal finance ( that’s where I learned about utility payments) , feel free to check it out. His account - lets_talk_personalfinance