November 18th, 2011 9:27 AM by Andrew Walter May
People want to know what effects their scores?
This piece talks about what not's out in the media.
We start with the facts that we know....there are 30+ factors effecting your score from payment history to total debt relative to total debt available. But there are other items that we don't hear about that effect your score significantly.
For example, your age. While it's illegal to discriminate based on age, the facts are friendly. Years of Credit Experience, is a significant factor. And how many 18 year olds do you know that have 20 years of credit experience? You get my point. Age matters when it comes to your credit score.
Managing your credit line versus limit is really important. If you owe $100k on a $300k credit limit that's not a biggy...but if you owe $550 on a $500 limit you will lose about 40-70 points. I had one client that hadn't changed his limits since college (he was about 35 at the time) and he regularly spent his limits and paid the card off every month. His scores were in the low 600s. Within a month we had him at 750. You simply need to ask for more credit line limits.
Lastly, judgments. Most people aren't even aware if one of these erroneously show up on your report. They'll chop 100+ points off your score. So, be diligent and fight to make sure someone doesn't throw an alarm bill on your credit. I've seen that happen before. Or, a phone bill....or cable bill. Those are the ones that happen the most.
Manage your credit to save tens of thousands of dollars on your mortgage. You owe it to yourself.