How to Master the FICO Game - ContinuedA Suze
Orman
exclusive Keep loan shopping to two weeks.
One thing you want to manage is how many times folks are asking
to look at
your credit record. That is often seen as a negative, since it's a tip-off that you may be looking to take on way too
much credit. But here's one neat way FICO makes sure we're all able to shop around for the best loans such a
mortgages: As long as you do all your shopping within a two-week period, all the credit inquiries made by lenders
will be bundled together and count as one simple inquiry.
Raise your credit limit.
This advice is only for those of you with strong financial willpower.
As we
discussed in Till Debt Do we
Part a large portion of your credit score is determined
by calculating how big
your monthly bill is compared to the maximum amount of credit you can use. To make this debt-to-credit-limit ratio
look even better, call up your credit card issuer and ask for your limit to be boosted. If you have a good payment
history they'll probably be happy to oblige. The trick though is that I don't want you to use that extra credit. It's
just like fourth grade math: the amount you run up on your credit card bill is the
numerator. Your credit limit is
the denominator. What we want to do is increase the denominator while not touching the numerator. That's going to
make your ratio improve.
Pay off balances BEFORE you apply for a loan.
It's important to understand that your FICO score
changes
along with your payments, and balances. So to make yourself look extra fabulous to a lender, try and get your credit
card balances as low as possible before you apply for the loan. That way, when the lender goes to check your score,
your debt-to-credit-limit ratio is going to be super low which will boost your score.
A bad score isn't permanent.
If you have trashed your credit record, don't think it is permanent.
If you
have the determination to change your habits and use your credit responsibly, over time the impact of your bad credit
history will decline and your good credit habits will boost your score. It can take a few years, but it is indeed
doable.< Prev | 1 2 | Next >Previous Article: Credit Reports: Check Them Now!
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