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Credit Score Help



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chili-n-cholent




 
 
    
 

Post Wed, Aug 05 2020, 1:58 pm
We are in the process of seeking and hopefully buying a house and could use some credit score help
We have a good credit score of 760 with 2 of our own credit cards open
As well DH is an additional to his father's credit card
The additional credit card comes up on our credit score and brings up our credit utilization to 17%, my question is if I should remove the 3rd card so it will bring our credit utilization down or will it affect my score and lower it as I have less accounts open now? As we will be applying for a mortgage we want to keep it as high as possible.
Thanks!
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ra_mom




 
 
    
 

Post Wed, Aug 05 2020, 2:54 pm
Closing a credit card under your name will lower your score for a bit. Don't do it now. The higher the credit you have with credit card companies, the better. Use the cards, pay them monthly. You'll be fine.
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chili-n-cholent




 
 
    
 

Post Wed, Aug 05 2020, 2:58 pm
ra_mom wrote:
Closing a credit card under your name will lower your score for a bit. Don't do it now. The higher the credit you have with credit card companies, the better. Use the cards, pay them monthly. You'll be fine.

lower credit utilization doesn't higher a score?
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yiddishmom




 
 
    
 

Post Wed, Aug 05 2020, 3:42 pm
In general, the ideal credit utilization is within the 30%. It could be tho that for a mortgage it's better to have lower.

I'm sure a mortgage broker can help you with this. Someone that specializes in first with first time home buyer's would probably know more.

Regarding closing the account: generally it lowers your score. Especially if this account is your longest revolving credit line. If it'll shorten your credit history than it'll have a greater negative effect on your account that the increased credit utilization.

Good luck!
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Plonis




 
 
    
 

Post Wed, Aug 05 2020, 3:48 pm
There are free online credit score simulators (like on CreditKarma) that will show you what it might do to your score.
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ra_mom




 
 
    
 

Post Wed, Aug 05 2020, 3:50 pm
anyone wrote:
lower credit utilization doesn't higher a score?

It does higher the score.
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zaq




 
 
    
 

Post Wed, Aug 05 2020, 4:13 pm
anyone wrote:
lower credit utilization doesn't higher a score?


it's not just how much credit you're using but what percentage you're using of the total credit available to you. So if you close an unused cc, you now have less credit available, making your existing debt a higher percentage of your available credit.
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zaq




 
 
    
 

Post Wed, Aug 05 2020, 4:22 pm
Ladies, please. Adult English if you don't mind. You RAISE or LOWER a score, "raise" and "lower" being verbs. "Higher" is an adjective, as in "high, higher, highest." When you raise a score, the score becomes higher. The word that's a verb (when it's not a noun) is HIRE, which means to employ for wages (or in Britain, to rent).

Yes, it's weird that "lower" is both an adjective and a verb while "higher" is only an adjective. English is a bizarre language. Comes from borrowing profligately from many languages.


Last edited by zaq on Wed, Aug 05 2020, 5:00 pm; edited 1 time in total
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malki2




 
 
    
 

Post Wed, Aug 05 2020, 4:58 pm
Never close a credit card! The additional credit card adds to your credit age which makes your score go up. Total accounts also raise your score. The most important factor (besides on-time payment and no derogatory remarks) is keeping low balances. Keeping a balance of 9 percent or lower of your available credit will yield the highest score. You can also lower this percentage by applying for another credit card because this will add to your total available credit, thereby lowering the percentage. If you close a card, it will also lower your available credit, and lower your score. We have a lot of recent experience with this stuff.

Last edited by malki2 on Wed, Aug 05 2020, 5:19 pm; edited 2 times in total
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Lets_Eat_Pie




 
 
    
 

Post Wed, Aug 05 2020, 5:14 pm
Closing a credit card won't necessarily lower your utilization, particularly if that card has a high credit limit. Think of it like a fraction: credit card balances are the numerator, credit card limits are the denominator. If you reduce your credit card limit by closing a card, the denominator will decrease, and the value of the fraction (aka your utilization) could go up. It depends on the actual limits and balances of the cards involved.
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ez-pass




 
 
    
 

Post Wed, Aug 05 2020, 5:17 pm
Call a professional mortgage broker who will tell you what to do. you can PM me for a number if you want of a mortgage professional who knows credit very well.
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simcha2




 
 
    
 

Post Wed, Aug 05 2020, 5:28 pm
760 is pretty high. I can't imagine that the few points difference will make a difference to your rate.
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ez-pass




 
 
    
 

Post Wed, Aug 05 2020, 5:36 pm
Correct. However, just know that when credit is checked for a mortgage it is checked differently than online.when someone calls my office and tells us they know their credit score, we are not allowed to use it. We need to run our own credit, as different company score differently.
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chili-n-cholent




 
 
    
 

Post Thu, Aug 06 2020, 10:00 am
Wow that really helped me, I guess we'll be keeping the account open as it doesn't sound like closing it will make that much of a difference
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malki2




 
 
    
 

Post Thu, Aug 06 2020, 10:10 am
Sign up with Credit Karma (creditkarma.com). It’s free and gives you your credit score and all factors affecting it. It’s pretty good for monitoring your credit. They also recommend cards if you want to apply to a new account. There’s also a phone app.
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