You know how you sign up for a store credit card, and they give you a 10% discount off that purchase? Okay, so let’s say you “Stumble” in Victoria’s Secret, and you purchase $350 worth of, ughmm, “clothing.” They offer you a 10% discount and future great discounts, if you sign up for a Victoria’s Secret Card! Cool, save $35! Not so cool.
One of the things we are seeing that is hurting people’s credit scores right now is the use of what I call “Third Party” Cards.
Those credit cards from Best Buy, or Macy’s or Pottery Barn… or Victoria’s Secret. The one’s that have the name of a BANK on the credit card bill, but the name of a STORE on the card?
Yep those are the cards you want to take your tax refund and pay OFF. Each credit score is like a snow flake… no two people have EXACTLY the same history, accounts, or scores…
But it you want a HIGHER credit score, you want to pay these types of accounts off… notice I didn’t say CANCEL the account. Until you have a “Bank” credit card, with a similar credit LIMIT – you want to keep the zero balance card, to help improve your score!
The goal is to have 30% debt to available credit. So if you have $1000 total available – you want to have no more than $300 charged. This is cumulative, so if $500 is on one card, and $500 on the other – you could have all $300 charged on one of the cards (I hope this makes sense, if not call me!)!
If you are raising your credit scores so you can get a mortgage, please call Steve and Eleanor Thorne, or for more information on raising your credit score so you can buy a house, 919 649 5058 This is especially important information for recent College Graduates who want to buy a house. Please call us with questions.
I try and answer all questions :)