Posted by Larry Gabbard on August 22, 2003 at 19:42:11:
That sounds great but by cancelling your credit cards you will get rid of potential “good credit” on your credit report. I have friends in the lending business that say if lenders see that you do not have credit cards they almost assume that you are unable to get them - that is bad. They say that the key is to have the cards but use them and pay them off. Lenders look at what credit you have available and the percentage of that that you are utilizing. You want to show that you can obtain credit and that you are responsible in using it.
Has anyone used Carleton’s Credit Pursuit Strategy?
I currently have four credit cards with balances and have been turned
down for credit limit increases recently. I would very much like to better
my credit in the short term so that the long term shouldn’t be a worry.
Does anyone have any suggestions beyond this strategy?
Re: Building good credit - the Carleton way? - Posted by Steve-nc
Posted by Steve-nc on August 13, 2003 at 20:25:08:
Ian-
One way is if you have some cash in a saving account, even a small amount, go to your bank and tell the lender you want to establish credit with them by taking out a loan and use your savings account as colateral. Make the term of the loan say for 6 months or a year. Make your monthly payments for a few months and pay the loan off a little early. There you go a good reference on your credit report.
Another, if you any kind of a consumer loan, like a car, furniture etc. Go again to your bank and refinance your loan with them.
If your banker tells you no, find out why and work on what you need to do to make him says yes the next time.
Buy a couple of properties and pay off your credit cards and cancel them and don’t ever get any more. Use debit card and cash. My wife and I paid of over $37,000 in credit card debt and have not had one in three years. If you need short term credit go to a bank a get a 90-180 day note.