Does Your Credit Suck? 

The real-estate market right now has heated up. Anyone trying to buy a decently priced home will find that the house they find to buy may have multiple offers on it. For reals. Why? I believe renters have finally figured out that rents are high and mortgage payments are cheaper than rent. But what if your credit scores suck and you can’t buy? Here’s some advice:

1. If you think your credit score sucks, it may very well not suck. I often talk to people who say things like: “I filed bankruptcy once.” That was 10 years ago and, well, if your credit has been good since your bankruptcy, then you should be able to qualify for a loan if you have good income and not too high of a debt load each month. Check with a lender, a good lender. Sit down, eye to eye, and have them go over your financial life. Spill your guts and see what they think. If you need some improvement, the lender will tell you how to fix your credit and maybe help you fix your credit. All for free.

2. If you want to improve your credit ratings, work toward these goals:

• If you have a $500 limit on your credit card, keep your balance under 30 percent—$150 or less. Credit raters love that!

• Improve your payment history—this makes up 35 percent of your total credit score. If you’ve missed payments or made them late, start using EBills to take out the minimum payment from your account so you don’t miss a payment or make a late payment again.

• Do not fall for this trick: “If you open an account today you can save 20 percent on your purchase.” The fewer credit cards the better. If your Visa is maxed out, don’t open a department store credit card because you’ll max it out on your first purchase, and it could mess up your credit later. Interest rates on store credit cards are higher than your Visa account. Credit rating companies don’t like seeing a lot of credit cards for stores.

I remember when I got out of college, just about every credit card company in the world starting sending me “free” credit cards. I also found that I could open up credit accounts with Nordstrom, Auerbachs, Weinstocks, Macy’s, Bullocks, Goldwaters, etc., etc., with just a signature. I think at one time I had 30 frackin’ credit cards. Now I have just Visa and AMEX, thank you very much. And when the nice clerk at Betty’s House of Big Girl Chonie’s asks me if I want to “Save 20 percent today by opening up an account today,” I just grin and say, “Nooooooooo.” I know better.

It’s totally OK to keep old credit cards/accounts open as long as you don’t get charged fees. Use them every once in a while to buy something, but pay off the total balance within 30 days. That kind of thing really, really helps your credit score.

• About 25-30 percent of your credit score is about how much you actually owe out in the world. Obviously, owe less and improve your credit. 

This article not prepared by City Weekly Staff. Content produced expressly for Classifieds Directory.

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