Quote:
Originally Posted by Porsche-O-Phile
It's a means to an end. By the time I go for a mortgage, I'll be showing a zero balance (or damn close to it) on my various lines and a historic utilization % that's pretty low. Not to mention the accounts will have been open for a while (2-3 years, all with good solid on-time payment histories). I've done some research on this and doing all these little tricks (including this, doing monthly payoffs of cash advances in full between multiple cards each month, etc.) are all things that can add up pretty significantly in terms of raising one's score. Research it - these kinds of things are worth literally up to a couple hundred points on one's FICO. That's bigtime real money, especially on a mortgage and most especially in a tight/restrictive credit market.
Of course, once you have the mortgage approval at a rate that's acceptable to you, you can go and do whatever you want, close the accounts, whatever. Yes, it's taking advantage of the system but I don't see anything wrong with it. It's simply knowing how to play the game and being smarter and more motivated than the average schlub out there in order to save lotsa lotsa money long term.
|
Having more than a few cards hurts your credit score. You want only a few cards with high limits and small balances.
When you go to buy a house you don't benefit from each number you can raise your fico score- over 650 to 700 is all you need to get the best rates.