Gonna buy my first real estate and a mortgage broker says
that the more credit I have available the better it looks. My
only credit card for 20 years now has been a
B of A Visa. She says to get a few more and use them
every few months. Do I really have to use them, or is it
enough to just have them ?? I just activated a Target Visa
but it's just sitting there.
thanks
In article <>,
wrote:
> Gonna buy my first real estate and a mortgage broker says
> that the more credit I have available the better it looks. My
> only credit card for 20 years now has been a
> B of A Visa. She says to get a few more and use them
> every few months. Do I really have to use them, or is it
> enough to just have them ??
Bunk. What she may be saying is that her company lends mostly
based on FICO score, and people that consistently use credit
tend to get higher FICO scores. One card should be just fine
as long as you don't have any late pays, missed pays, overlimits,
or the like, and you don't carry too high of a balance compared
to your income.
-john-
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John A. Weeks III 952-432-2708
Newave Communications
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John A. Weeks III wrote:
> Bunk. What she may be saying is that her company lends mostly
> based on FICO score, and people that consistently use credit
> tend to get higher FICO scores. One card should be just fine
> as long as you don't have any late pays, missed pays, overlimits,
> or the like, and you don't carry too high of a balance compared
> to your income.
Do check, however, that your card provider reports your limit
accurately. Some of them report a $0 limit, which can ding your FICO
score because any balance is above your limit.
--
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Ian Pilcher
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In order to qualify for the "best rate" possible, you should have a
min. of 3 ACTIVE tradelines (car loan, credit card, etc. all qualify as
a tradeline).
In order to get the "best rate" possible, most lenders will base your
qualification/borrowability (I know it isn't a word, but I hope you get
the inference) on your FICO scores. The rule of thumb is the higher
the FICO score, the lower the cost of borrowing is to you.
This exercise can be avoided by applying for a loan that doesn't
consider your FICO scores, but the downside will be a higher interest
rate.
Make minimum purchases with these new tradelines/credit accounts you
have established (and pay the balance off every month so as to avoid
interest payments) and you will see that your FICO scores will
increase. The downside to establishing too many credit lines (if you
are not prudent in your use of the same) is that your DTI (debt to
income) ratios could have an opposite effect then what is desired (this
is not a concern if you make small purchases like I/curent lender
suggests).
It is not enough to have them, they must be active and in good
standing.
If your scores are currently 720 or higher, then you can proceed with
confidence that you will be extended the "best interest rate" possible
(To ensure this, it is wise for you to comparison shop with 2-3 lenders
before signing the dotted line).
Regards,
Scott Miller
Commercial and Residential Lender/Broker
www.RealEstate-IQ.com
www.EZMortgageLoanz.com