INCREASING CREDIT SCORES / PAYING OFF INSTALLMENT ACCOUNTS VS PAYING DOWN REVOLVING ACCOUNTS
Here is an e-mail that I just sent out. It is very educational. For more credit score education, read the following article: http://www.creditrepairwholesale.com/Credit_Score_Education.html
Congratulations on paying off your installment account with Reliable Credit. Once we get that updated on your credit report your credit score will go down. I know that I have talked to you about this before. If you remember, FICO scores only give you points based on OPEN and ACTIVE accounts. Once you pay off an installment loan the account closes and you lose the points that you earned while paying the account on time.
If you want to refinance your bike and you want to walk in to the finance office with the best possible FICO scores, there's what you need to do.
Pay the following account balances below 50% of the credit limit:
1st Tech Credit Union
Current Balance: $607
Limit: $700
Please pay down below: $349
1st Tech Credit Union
Current Balance: $383
Limit: $500
Please pay down below: $249
1st Tech Credit Union
Current Balance: $373
Limit: $500
Please pay down below: $249
The balances on your accounts influence 30% of your credit score. That's 255 points. FICO doesn't care what the balances are on your installment loans (your loan with reliable credit is an installment loan) unless that balance is past due or upside down. They grade you heavily based on the balances on your revolving accounts (1st Tech Credit Union). If your balance is above 50% of the credit limit, your score will drop about 7-15 points for each account. By reducing the balances on the three accounts listed above, you may see your credit score increase by about 20-30 points.
On another note, there was a collection deleted from Equifax on the latest round. Your scores went up as well.
EQ from 729 to 735
XP from 723 to 780
TU from 738 to 786
Warm Regards,
Jack B. Olson
Jack B. Olson
Account Executive
P - (866) 979-1099 ext. 205
F – (866) 979-1097
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