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2manyrocks · 01-14-2009, 10:22 PM

Notes on Credit Cards:

What difference does the score make? Higher score means funds can be borrowed at a lower rate saving huge amount of money over the long run.

How can a score be improved? 1) pay bills on time. Payments over 30 days past due can pull score down by 50-75 points. 2) Establish long term pattern of responsible use of credit. 3) Keep balances low on credit cards. Stay below 33% of the card limit and do not max out. 4) avoid opening too many cards because the companies will average the length of time your credit has been open and this will lower your score. 5) opening a new card before buying a home is a red flag that you may max out your credit.

Watch out for the fine print in credit cards. Late payments can result in huge fees and significant increase in the interest rate. The credit card companies reserve the right to increase their interest rate if payments are late. Read the fine print.

Do not put the kids on your credit card. Ruins your credit and doesn稚 establish credit for the kids.

Merchant cards are not recommended.

Check your statements and immediately contest any fraud. Be careful not to pay fraudulent items or you may have waived your rights.

Watch out for errors such as similar family names being mixed up on your credit report. ( JR, Sr, III) Watch for outdated information and transcription errors.

AVOID: check cashing places, payday loans, 401K loans, home equity loans (you spend your home equity and now this debt is secured by your home if you can稚 pay it); reverse mortgages mortgages loaded with fees and traps; credit card transfers with 3% immediate balance transfer fees.

By the way, I forget the statistic, but merchants like credit cards because people using them will typically spend more than people who only spend cash.

01-14-2009, 10:22 PM	#13 (permalink)
2manyrocks Veteran Member Join Date: Jul 2007 Posts: 1,516	Re: Interest Rates/Refinance Notes on Credit Cards: What difference does the score make? Higher score means funds can be borrowed at a lower rate saving huge amount of money over the long run. How can a score be improved? 1) pay bills on time. Payments over 30 days past due can pull score down by 50-75 points. 2) Establish long term pattern of responsible use of credit. 3) Keep balances low on credit cards. Stay below 33% of the card limit and do not max out. 4) avoid opening too many cards because the companies will average the length of time your credit has been open and this will lower your score. 5) opening a new card before buying a home is a red flag that you may max out your credit. Watch out for the fine print in credit cards. Late payments can result in huge fees and significant increase in the interest rate. The credit card companies reserve the right to increase their interest rate if payments are late. Read the fine print. Do not put the kids on your credit card. Ruins your credit and doesn稚 establish credit for the kids. Merchant cards are not recommended. Check your statements and immediately contest any fraud. Be careful not to pay fraudulent items or you may have waived your rights. Watch out for errors such as similar family names being mixed up on your credit report. ( JR, Sr, III) Watch for outdated information and transcription errors. AVOID: check cashing places, payday loans, 401K loans, home equity loans (you spend your home equity and now this debt is secured by your home if you can稚 pay it); reverse mortgages mortgages loaded with fees and traps; credit card transfers with 3% immediate balance transfer fees. By the way, I forget the statistic, but merchants like credit cards because people using them will typically spend more than people who only spend cash.