Tuesday, July 5, 2011

How Getting a New Credit Card Impacts Your Credit Score ?

Credit Card
My credit card and then a couple of posts, commenters asked about the impact your credit score to get new cards. As we know, a good credit score can make all kinds of good things for us - to secure low interest loans (we should borrow, not really) to help in the job interview process as the test car passes the savings on insurance. Need a good credit score.

What is a good credit score? According to Money Magazine (July issue), 750 or more points and "good" if you have the best rates, discounts, so you can get. They note that 1 / 3 of this series.

This piece is broken by the Wall Street Journal as follows:

Credit score is a complex and proprietary algorithms that are considered by scoring among different agencies. However, there are usually three main pieces.

The most important: their bill - payment history. Over more than 35% for you as it is responsible. Pay all your bills in time. If it is only the minimum payments, the bill ensures that the specified date, or are checked before payment.

Credit - - are available for years, about 30% of your score for the count - the next, the loan or "rate, use the". Ideal, but the use rate of 10% 0% more.

Credit Card
Mixture and about 15% of your credit history contributes to your score. Creditors to see how you credit, or credit cards and installment loans such as mortgages and car and student loan is revolving, restricted. Number of accounts divided by the average account age.

Opening new accounts may affect your score is 10%. "Taking on new credit risk has been shown that high level," says Mr. Paperno. "What the new credit is not the default for more than the recent trend that has been linked to it."

But it's not that anyone else notice that the Wall Street Journal, you can not count? He says, "There are usually three main pieces" and then lists four. ;-)

None of them, and they see the impact of each mother will get a new credit card:

Payment - - in their history to get a new card bill - the bill's impact on history will not get any. Of course you should always pay your bills on time and if you are not (and racking up a debt), you do not need additional credit cards.

Your debt. In this regard, a new, extra credit cards can actually help your credit score.

Aggregates and credit history - the "new" history card with zero impact is difficult because it is not here. Is it good or bad? And how good or bad? It's hard to say, so I would say. An interesting note, my credit score, perhaps because I now have a loan (a mortgage, school loans, car loans, etc.) have been used for nearly 15 years had a negative impact on the size - and "good" can I get how it pursues. That said, I have 800 points on the right, then I'm right.

Open new accounts - this is where you have a bit of the course, the doctor for a new credit card to create a new account can be found.

So what conclusion? Here's my take:

Open a new credit card for credit score has been washed. It is used as the hit rate advantage, but it takes a new account.

That said, I rather error on the side of caution, so I create new accounts / cards are added on a regular basis.

We have been assuming that the old accounts as part of adding a new card, do not cancel. How much (5 points, 10 points?) And how long it's hard to say.

Being a large available credit limit credit card with tons of bad thing - it's all about how to manage credit. If you read the WSJ article linked above, you that it is mainly about a person's name to see Pete D 'Arruda's. The 25 Visa, Mastercards, and individual stores, airlines, and more are available by credit card, gas is $ 300,000.815 to 810 on your credit score is very high.

Article says he's "more Theory - A better test is available in more than one credit card and, well, handle the issue of the mother -. bills are paid promptly," it seems to work. The key right above the card management principles.

For now, here is my list of the best cash back credit card.

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