How do I correct credit score?

soulshine616 · Joined: 28 Oct 2009 Posts: 1 1.57 Dollars($)

I have been trying since June, 2009 to get a mortgage. My credit score needed to be improved. Well I have improved it from 584 to 614 since then. But in August, Sept and Oct my score has not changed. I do not have and have never had credit card debt. So don't tell me to pay my credit cards on time and pay the balance down in order to raise my score. That seems to be the only answer anyone ever gives me. The mortgage company keeps telling me since I don't have credit card debt that it will be hard for me to get a loan. Why????????? Just seems to me a lender would be willing to loan money to a person that isn't up to their you know what in credit card debt than lending money to someone that owes everyone in the world. I realize lenders are looking at the ability and willingness to pay debt, which I have on my credit report, but still I can't get a loan and no matter what I do, my score continues to stay at 614. I have done everything humanly possible to get the score raised, but nothing is working. HELP!!!!!!!!!!!!!!!!!!!!!

gmakerley · Posted: Wed Oct 28, 2009 8:22 am Post subject:

what is it that constitutes your "credit" to begin with? do you have installment loans (car, student, etc.)? have you had inquiries that show up that may have resulted in keeping your score down? what you'd like to have happen is a prolonged period of making payments on a timely basis on whatever it is that you do have, so that you'll show a longer history. that would do the job, hopefully, in bumping your score a little. is there nothing working in your favor at this time?

raymond · Posted: Wed Oct 28, 2009 9:11 am Post subject:

I've seen that before, and the only thing I know to suggest is to get two credit cards and make regular payments. Your FICO will suffer a little initially, because you took on new credit, but then it'll increase with the on time payments. I know it sounds a bit odd, but that's the way the system works.

There's a good book that explains it all, titled "Credit Scores & Credit Reports - How the system really works, what you can do", by Evan Hendricks. ISBN #0-9645486-3-1. Read that book and you'll understand what's happening and what do to about it.

gmakerley · Posted: Wed Oct 28, 2009 10:19 am Post subject:

not a bad idea, raymond, but i don't think it is going to be all that helpful in this instance. it seems like soulshine is looking for a more immediate resolution to the situation, and the adding of a couple of credit cards will take a bit of time to begin to make a difference. in fact, i'd submit there might be a slight dip in score with new inquiries and subsequent new credit opened.

not a bad idea, in the overall scheme of things, but it looks like a non-solution in this case.

creditcure2 · Joined: 05 Nov 2009 Posts: 2 1.61 Dollars($)

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riseabove · Joined: 09 Nov 2009 Posts: 70 12.67 Dollars($)

I've also heard that you score goes up if you have more credit available, but don't use it - is that right?

gmakerley · Posted: Fri Nov 13, 2009 11:05 am Post subject:

yes, rise...if you have a credit card, for example, with a limit of $1000 and a balance of less than $300, that's going to work favorably in credit scoring. as the balance is reduced, thereby giving more available credit, the score would be further enhanced. conversely, the larger the balance and lesser the available, the more harm that could be done to a score.

riseabove · Joined: 09 Nov 2009 Posts: 70 12.67 Dollars($)

So having multiple cards, with as big of a limit as possible - BUT NOT USING THEM - would actually increase your credit score? Is this seen as demonstrating self control or something?

Is it just the total amount of credit used vs total available that matters or does the number of sources also have a bearing? e.g. is it beteer to have 10 x $1000 limit cards, or 1 x 10K?

gmakerley · Posted: Sun Nov 15, 2009 9:22 pm Post subject:

i think having ten cards is unwise, but i also think that's more likely to boost a score than having one with a large limit.

it's a matter of available credit - responsible people, in the credit parlance, don't use all of their available limits; hence a higher score results.

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