Monday, January 25, 2010

Tips for keeping your credit score high

Credit scores are important in the financial lives of your clients, so I'd like to share a few tips I picked up at "Understanding Credit and Credit Risk Scores," a presentation by Todd Overstreet, director of field sales and service at Rels Credit, the credit reporting agency for Wells Fargo, at the Women's Business Network in Wellesley, Mass. on Jan. 8.

Overstreet gave many tips about how to minimize damage to your credit rating. The following particularly piqued my interest:
  • Use less than 50% of your credit line. If you use more, creditors will start to worry about your ability to repay.
  • Make all of your loan applications within a 14-day period if you're shopping for loans. Each credit inquiry by a lender typically lower your credit score by three to five points. However, "If a consumer shops with five different mortgage lenders within a 1- day period, those five inquiries are grouped together and will only affect a consumer’s score 3-5 points total," said Overstreet in an email to me.
  • If you must close a credit card account, start with your newest card. Creditors like to see a long credit history.
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Susan B. Weiner, CFA
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Copyright 2010 by Susan B. Weiner All rights reserved

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